NavList:

Sadly, we keep getting back to the same point:   What accuracy is practically achievable in a small craft at sea??  I have some but not a huge amount of at-sea experience with celestial.  Every time I have tried, though, I found that keeping my sextant correctly aimed at the body and (most important) at the horizon is very difficult from the heaving and rolling deck of a small pleasure craft.   

We're not talking about the Titanic here, we're talking about the average boat the one of us might set out on a trans-oceanic voyage. If I'm not mistaken, statistics show that the typical non-commercial trans-oceanic voyage is made aboard a 40~42 ft (12~13m) craft.  

So, yes, one should be worried about getting too close to low-lying atolls.  But in my mind the good navigator understands the accuracy of his/her navigation and adjusts accordingly.   So if my estimate is that my celestial accuracy is only +/- 10 nm due to the size and stability of my craft and I might be set 10nm overnight, I should not heave-to just 20 miles from the atoll.

In the middle of the ocean it doesn't matter.  Approaching the Minerva reefs, Tuamotus or Chagos Archpeligos it matters greatly.  All of these are low lying or awash so a navigator on a small vessel would want to be accurate to several miles rather than 10nm.  

Approaching the Tuamotus at night on would want to heave to an wait for daylight before approaching and entering.  The currents in this area can be very random.  You might think that stopping 20nm from the atolls would be sufficient but if you are actually 10nm or so closer, between 0000 and 0700 you could be swept 14-18nm closer whch would put you into the atolls and shallows.

There are plenty of places where you want better accuracy or at least a better idea of what the errors in your position are likely to be.