Log, but more generally machine data, monitoring and correlation, is used by many different businesses to accomplish a wide variety of goals. You may be interested in reviewing a number of the Splunk customer stories: http://www.splunk.com/customers
As a concept log monitoring in and of itself is neither dangerous nor safe, rather there are a number of considerations and details about your environment including (but not limited to) access controls, transport protocols, and even the nature of the data being collected itself, that may present various risk factors and that you would want to mitigate when implementing a log monitoring strategy, if such risks are not acceptable to the organization. Careful evaluation of these risks and implementation of mitigations of unacceptable risks allows for the successful deployment of data aggregation solutions in even the most secure environments (and it as a concept could even be used to mitigate other material risks to the organization)
Splunk for its part provides some of the basics in terms of tunables available with their software in the docs: http://docs.splunk.com/Documentation/Splunk/6.4.2/Security/WhatyoucansecurewithSplunk
Splunk and a number of their partners with certain sets of skills can also be contracted to provide Professional Services that can help with secure deployment in risk adverse environments.
