Regrinding tools can produce carcinogenic carbide dust. Some woods are toxic, such as cocobolo dust. The biggest danger is in the carcinogenic nature of the many finishes. Elaborate breathing equipment has to be used, and you can absorb some toxic liquids through you skin. Crosslinked finishes, such as CAB, catalyzed lacquers, and conversion varnish are all very dangerous.
Polyester is among the worst.
Even the common urethane lacquer and nitrocellulose lacquers are dangerous. And if the fumes don t kill you, the flames might. Many finishes are highly flammable. Shellac, with an alcohol solvent base, is a common fire hazard, as are most finishes without a water base. Moisture cured polyurethane is both flammable and very hazardous.