I wouldn't WANT to be in that kind of pit.
I've seen people hurt, but it's almost always
accidental. When someone gets out of control,
the rest (and the bouncers, sometimes) make
it pretty clear.
As to watching, I've stopped really caring too
much about that. I'm not even sure I listen all
that much. It's the transcendence of the dance
itself. But, much better than with recorded music,
as instead of playing to/with the crowd, I'm doing so
with the band. It's not as good, if they're not aware,
so I think I enjoy small venues a great deal more.