Wasn't going to, but feel I should weigh in on this discussion. I am a physician (Critical Care and Anesthesiology), and was formerly a consultant for the nuclear industry and defense departments (16 years in Naval and commercial nuclear power).
Warning, science will follow!
That said:
MM is spot on to a degree. Every time you smell something, that smell is the brain trying to make sense of signals received from thousands of olfactory nerve ending coming directly from the brain through the crib inform plate. That is the bone at the base of the skull inside the roof of the nose.
Anything that triggers those nerves/receptors sends a signal to the olfactory cortex (part of the brain). How the brain interoperates these signals is what constitutes smell.
Most often, airborne vapors (gaseous chemicals) trigger these receptor. However, they can also be directly triggered by particulates reaching the receptor cells. For each chemical, there is a minimum signal (threshold) below which we are not sensitive. Many things alter this sensitivity and the perception of scent; age, medications, other medical conditions, and learning/experience.
That's the nose and olfactory nerve story.
lungs, on the other hand, are designed to breath air. Many things can injure or irritate the delicate lining of the respiratory tract. It is heavily innervated, as it is a matter of life or death. The brain reacts very strongly to inhaled irritants.
We know that inhaling silica, in various forms, can cause cancer in the lung. The most scary of all is mesothelioma. That is essentially a cancer of the lungs lining. It is incurable and always deadly. You may have heard of this being caused by inhaling asbestos fibers (stringy silica), but it can and does occur from inhaling small particles of silica in any form. Aluminum Oxide, while not officially a silicate, has been implicated in several bad lung diseases, including a form of black lung and mesothelioma.
Anything that irritates the lung or respiratory piping (trachea, bronchi, alveoli) will cause a reaction. Many times (actually most of the time) these interlocking particles are expunged by mucous and the ciliary elevator system (little cells that line the piping, and wisk irritants out as sputum). Sometimes that system is ruined by smoking or constant irritation from a regular exposure to irritants. If the body can't rid itself of these unwanted visitors, it walls them off in an attempt to isolate the irritant. This results in small areas of lung that cannot exchange gases. If constant, repeated, and irritating enough, it can result in asthma, emphesyma, or cancer.
I would agree that one should not inhale AO dust. I also would agree that inhaling any particulate on a regular basis is bad (cloth particles, coal dust, cigarette smoke, chemicals of any sort that irritate the lung).
AO dust is particularly difficult because it remains airborne for a long long time (aerosol). As said earlier, metal grinding do not stay airborne very long, and are easily caught before the become airborne, if they are magnetic, and can be thrown in front of a strong magnet. Not only will CBN wheels make for sharper tools with less overheating of the tools, but it does not break off the wheel to be one airborne. I myself use CBN wheels exclusively, and have several bar magnets sitting in front or and behind the wheels to catch these grinding pArticles. When the magnets get "hairy", I take them off and brush them into the trash using a stiff brush.
If I used AO wheels, and turned more than once in a while, I would use a good N95 level respirator or a good evacuation system to catch and prevent the dust from being inhaled.
End of science discussion. Hope I didn't cause any seizures.