We train 'em as a part of foul tactics and clinch work. Not a good idea, I don't think, to do it with folk you've not trained with a great deal. We train with "progressive resistance", an effort to make it realistic as possible without actually injuring one another.

Anyway. We've also used it in Filipino numerado and sambrada drills, mostly just playing with ideas doing "triplets" and follow ups and such. We "indicate" head butts, use the head for moving from one side of the body to another, breaking up a clinch, during pummeling, for takedowns... As you're indicating though, particularly when it's a drill being done on "both sides", sometimes there's some contact between our melons. The idea is to learn to train at a speed everyone can handle/agrees upon, and it minimizes injuries.

Oh yeah- one other thing- gear is good. We don't use head gear as much as we should, but it is a good idea to do such with head gear on if available. Makes most of my critiques irrelevant.

Yes, as with any technique head butts have their place and can be especially useful in ground fighting/holds as corwin mentioned.

Though practicing them effectively is another matter altogether.

Also as corwin mentioned, there is more to using a head butt then the typical movie style strike. Though you should be carefule or desperate if using a side to side style move, as the sides of the skull are not as thick as the front or rear, not to mention the vulnerable temple area. You could easily do yourself more harm than your attacker if you impact his head with your temple.

Oh yea, if the situation is really bad, we bite too.