Another question about net calories (and breastfeeding)

I'm currently breastfeeding my 5wk old baby. He eats lots (no formula - just me!).

I'm 5'6" and went up to 153lb when pregnant. I'm now at 136/137 and would like to get back to 128lb which is where I was before I got pregnant (not sure if you can see my stats, but the '132' which is on there is from after my previous pregnancy - I used MFP then to lose weight - so isn't relevant).

I exercise and burn about 4-500kcal a day from that, plus I'm active: I walk with the stroller lots (with two children in - a toddler and the newborn), do the housework, and generally move quite a lot. MFP also adds on about 500kcal for the breasfeeding.

I've just looked at my report for net calories over the last few days (I only started MFP a few days back) and I'm consistently netting until 1200kcal: sometimes only netting 700... I eat regularly but very healthy stuff. However I have energy (other than the lack of sleep!) and don't feel like I'm depriving myself.

But having such a deficit is bad right? I need to do something about it, despite feeling ok on it?