I've used the plastic tanks for years without incident... Also very easy to enclose them in a sheet metal or aluminum container... Adds a bit to the safety issue and really helps the appearance.

As for having the tank and the battery in the same area, I would have a metal divider between them. Should you decide to totally enclose the battery in a metal or plastic box, make sure you vent the enclosure!!! An unvented fully enclosed battery box can make for a really big BOOM given the right circumstances!