There is a lot of good information here and some misinformation, as well as many open questions. The bottom line (so to speak!!!) is that human manure will over time and with bacterial action, turn into compost: fertile and un- infectious. There are a variety of systems for controlling this inevitable process, to enhance it, to accelerate it, to guarantee it happens thoroughly and completely every time.
Many water wells reveal high levels of fecal coliform bacteria when tested. Nearly always, this bacteria did not come from outhouses or barns --- it migrated underground from somebody's totally legal government inspected $10,000 septic system. So even though the Health Department and Building codes stringently enforce their regulations, it happens ( as they say, "sh*t happens.") Here in Western WA, the Hood Canal region of Puget Sound is full of putrefying nitrogen that came from somewhere, probably local septic tanks. I am told Cape Cod also has this problem. Septic tank systems are inadequate, and don't work, although required by law.
Fecal coliform in itself is not very toxic. As David Holmgren pointed out, if you have a meal of produce contaminated with your own bacteria, you won't get an infection because you have literally already "had" it --- your immune system is living symbiotically with the particular strains that populate your own intestines. In small doses, as in a public bathroom, any bacteria is just an education for the immune system, a virtual inoculation. Take a trip overseas or encounter new strains, you might get diarrhea. I have never heard of anyone seriously ill from it, although I am sure it can be dangerous to the immune- compromised. Neither have I ever heard of anyone ill from eating food at a picnic where flies and yellow-jackets were landing on the food, after landing on dog poop and rotting roadkill. It does not worry me.
The type of e.coli that is dangerous, (strain .0157 etc.) is not what you find in human poop, but rather in certain livestock manures. It is rare, not endemic, and does not arise spontaneously. Animals have to catch it. Also I am not convinced that tests for it in raw milk are meaningful.
I think its great that some people are just quietly disobeying the law, proving another Way exists and is viable. Bacteriologically speaking, a compost toilet operating aerobically is probably safer for human health than a septic tank digesting anaerobically 6 feet underground. IMHO the human love for gadgets and the builder's love for bulldozers and the government's love for control have more to do with septic tanks than hygiene does. Hurray composters!
The point of a compost toilet is to "capture and store energy." Then it isn't really "waste" is it?
I use a 5 gallon bucket with pine duff, which I seal and leave to age. I believe forest duff works way better than straw or sawdust because it is much more biologically active.