Y'know, looking at these stories, I think it's a bit of poetic justice that these folks cut themselves while abusing your knife. So, yeah, loan it out. If they screw up they'll know it. Then you can look at them innocently and ask if they have a FAK so you can bandage them up. Then roll your eyes and act like they're an idiot when they have neither a knife nor FAK.

And if they break it, get money from them right there and then.

To be honest, I don't have a horror story. The only cuts a friend of mine got was when I ran him over on my BMX back in the '80s.