Good question.
Flying is dangerous, however much we tell non-pilots it isn't. But then, so is driving, and so is getting out of bed in the morning. And whatever you do, life is invariably fatal eventually.
So having got that straight, it's down to personal choice. I fly over water as high as I possibly can. But that didn't stop me flying in a helicopter to France at 1200ft; we couldn't get any higher because of cloud. We wore life jackets, but had no space for a liferaft. I've been meaning to do a ditching course - one of these ones where they drop in a lake or similar in a cockpit so you can try getting out under water etc - but I haven't done it yet. I learned to fly at Welshpool, and remember asking before I went to Caernarfon (my first trip after getting my f/w PPL) what to look out for; I was told in the event of engine failure head for a valley - gives you more time and more options. Everyone's different; when I flew in a heli to Paris, my co-pilot wasn't keen on my flying at 1000ft as it didn't give us a lot of time if we had to auto-rotate, so I flew at 1500. But I'm just back from a quick trip to Florida for Heli-Expo; we got some R44 flying done with an instructor, and flew along the beach at 300 ft, with Palm Bach telling us to keep below 500 ft to be clear of other traffic. No 500 ft rule over there, and most helis fly very low. We also looked for alligators over the swamps at 100 ft, but I'm not sure if that was legal even in the US. <img src="frown.gif" border="0">
Basically I decide what I want to do, consider safety as far as is possible and practical, but refuse to let it stop me having fun. And if that attitude kills me, well, I don't really fancy living to 100 anyway.
. I guess someone here will flame me for that, but there it is.