To me it doesn't matter what the rate of failure is on automated systems, as long as the rate is below human failure rate. In that case, we win. It also doesn't matter whether humans can recover given a failure, again given that the failure rate is already below the average human failure rate.
The problem is that humans are really hung up on the illusion of control. We know that in a car that drives it self that we're not in control and the prospect of that machine killing us without our intervention scares us. What we're not so sharp on is that by taking control we are [hypothetically] increasing the chances of our injury or death, and in a field of all manual or all auto cars, manual control doesn't even favor skilled drivers since the real danger for above average skilled/careful drivers is the /other/ drivers on the road.