Here's an interesting video related to kids and learning.
Have to say I agree with a lot of that... Reminds me of a time when I was in the Philippines watching a couple of 5 year-olds using a rusty knife with no handle to cut up green mangoes.
Also like the part about anything sharper than a golf ball needing a safety warning. Still pretty annoyed that my totally awesome truck that theoretically can get 50 mpg is not "street legal" because the gov't says it aint. Thank goodness for loopholes.
As for doing dangerous things- In my 2 1/3 years as a teacher, the worst injury I've had in my shop (knock on wood) was a concussion. Course, the kid had already had two concussions the week before at football practices, which caused him to faint in my shop, fall over backwards, and whack his head AGAIN on the concrete. Lots of little cuts, some smashed fingers, and a burn or two, but so far thats it. (again... knock on wood.)
Set some simple rule, explain the consequences, and they do a pretty good job of governing themselves. If they dont, the learn the consequences firsthand and are extremely unlikely to make the same mistake again. Like the fellow in the video said, they're young, they heal fast. (hopefully, he was being a little sarcastic!!!)