The other problem is that they act like gyroscopes. Which means that depending on how you mount them, will either constantly exert a precessional force on your vehical, or really protest you making sharp turns at high speeds.
There's also anything built in layers, where the outermost layer will shred, bleeding off massive amounts of energy in relatively low-mass pieces, much more easily contained. Often carbon fiber, but that's just the main material I've seen for this. Dangers associated with flywheels are becoming less and less of a problem, and will only continue to do so with more research.
That said, I'd still be interested in seeing how it reacts to a hard collision. I think that quote mostly refers to over-spinning.
[1] : http://en.wikipedia.org/wiki/Flywheel_energy_storage#Advanta...
Besides, keeping two wheels synchronized is not the hardest thing to do, a car contains a lot of moving, synchronized parts.
There is a solution to this: flywheels that use tightly wound metal tape instead of solid cores. Tape flywheels just unravel inside the casing safely when they break.