You ask a fundamental and very important question regarding what is the appropriate baby proofing philosophy to adopt. I will walk you through several aspects of my philosophy which you will find to be somewhere between the two extremes you referenced in your question.
"No" versus "Go". Expecting to teach a baby or toddler "No" to any and all dangers is not practical in most cases. I am a proponent of establishing an environment in which a child can explore safely, for it is through exploration that our children learn. Saving our "No’s" for the most imminently dangerous situations will increase the likelihood that they are heeded. Even if your child happens to be one of the few that consistently adheres to your verbal boundaries, visiting toddlers may well not, so you may still wish to make some modifications on their behalf.
"Primary Hang-out Areas". Creating an environment that is safe to explore does not mean "rubberizing" the entire house. I strongly encourage parents to define the "primary hang-out areas" in the home with barriers. For many families this means one or two gates that isolate the kitchen and family room and a gate at the top of the stairs (or leading to the bedrooms in a single story home). Once these areas are defined, parents can create safe environments there-in while perhaps leaving the living room, dining room and office more adult friendly.
Multi-Phase Approach. An infant’s well being will benefit from smoke detectors and proper placement of the crib, but may not require latches on the cabinets or safety gates for several months. Rather than becoming overwhelmed at the thought of doing everything in one fell swoop, update your home safety efforts every six months hopefully keep a step ahead of your child’s development.
Beware of Mixed Messages. We all know that consistency is key to successful parenting. The same principle applies to safety since we can inadvertently send children mixed messages which may come back to harm them. Allowing a child to play with pots and pans on the floor, sends the message that they are "toys". Unfortunately, many children have been severely burned retrieving their toys from atop a hot stove. Storing chemicals and cleaners in other than their original containers has led to numerous accidental poisonings. Allowing a child to crawl on a pool cover may give them the sense that they can walk on water. Placing off-limits items out of reach on a dresser or bookshelf may encourage a toddler to climb an unstable piece of furniture and have it topple upon her.
I have covered some of both the philosophy and psychology of home safety which I hope will encourage you to do more than just say "No".