> Maybe there is a concentration of oxygen that is high enough for humans to survive, yet too low to sustain combustion?

Yes, supposedly (12% ish?). Can't say I'd be thrilled at the idea of testing it.

The "gas" is more like a fog of capsules. FM-200 is a common one. Basically it has a Fire suppression agent inside crystals which are blasted into the room by compressed air. These crystals melt when they get over a certain temperature and therefore won't kill you; however, breathing that in isn't really pleasant.

Source: I've been in an FM-200 discharge