I was recently made aware of a defensive shooting school that allowed its instructors and students to unload their guns, point them at each other, and practice dry firing. It was supposedly to allow students to get used to pointing real guns at real people. I have also been informed of another training school that allows students to go downrange and stand between targets while others are firing live ammunition at the targets.
I don't know, but I suspect the argument is that "we make sure that the guns are unloaded" and/or "the live-fire experience is done under strict control and guidelines." Interesting. I once knew an instructor who walked in front of the line while his students were dry-firing on targets. The bullet that hit him in the chest nearly killed him.
Regardless of what the arguments might be, the fact remains that these sort of practices violate the basic safety rules of any serious shooting organization. To paraphrase the old quote about passing a football, when you do something like this, a lot of things can happen–most of them are bad.
One indication that you have signed up for a legitimate defensive shooting class is when gun safety is emphasized and enforced. Moreover, you see that the instructors are setting the example for safety at all times.
However, the responsibility for gun safety is on you. When you don't understand how a class drill can be safe, ask for an explanation. If the explanation doesn't suit you, you have the option of sitting out the drill or of packing your gear and going home. Losing your tuition money is not nearly as bad as getting shot during a dumb shooting exercise, or even being present when someone else gets shot. Then, when you get home, spread the word. Make sure your friends and associates know that a school is not safe.