Hi Jesse,
I have only used small amounts of bay wood (because of availability) in my hugelbeds. However, I don’t think it will be a problem in larger quantities.
I have heard that it is different from some other members of the Lauraceae family, so cyanide shouldn’t be an issue. Besides, if it is green wood it will décompose slowly and any gases would therefore also be released slowly (and into the open air rather than a confined space such as a
greenhouse).