The best safety is always in visible light.
A visible laser is safer than an infra red one of same power, the same goes for un-lased-light (normal LED, Incandescent, Fluo), since your eye will react to visible light and trigger a reflex to minimise lens opening (closing or iris or eye). Of course very powerful lasers will deliver too much energy in the time it takes the eye to close, which is why the 5mW commercial red laser limit was set. That is below that point.
That said, when comparing a laser to a normal kind of light, a laser is easier to be "threatening" to health, but if you use a ton of IR LEDs to deliver 50mW of light on a 0.5mm spot, you're still delivering the levels of energy that can over-stress or damage retina. So in some ways it's a bit of a straw man.
The principle reason people went for IR LED versus laser back in the day is purely because a red laser is visible and an IR LED is not, where an IR Laser would be too dangerous as it offers no ocular response. For there to be rules about not being allowed to use Red Lasers for safety, would need to include a power and convergence meter for any and all IR applications. Using a Red Laser is just "boring" from a war-game point of view, because in a smokey tag-hall everyone can trace the line to see where you're hiding.
If you want the most fun, but safest possible tag system, you are well off choosing a couple of IR LEDs that you bundle using "cheap" lenses from any online outlet you can think of and just testing the range with that. You can even see beam-convergence on a cheap night-camera with its own IR LEDs turned off. That should be easy to buy or borrow for nearly no money at all.
If you still want to use lasers, but at lowest possible light output, you can force a laser module into sub-optimal operation to make it drop its output power by going to the edge of its specified supply voltage. For most cheap modules the 5mW -> 0.5mW path will be in the area 3.5V -> 2.5V supply, would be my expectation. You can slowly tweak up the supply for each built set-up till just after it goes bright enough for "detectable at 100m".
-- Don't expect much more than 100m with a laser, since aiming will be an issue with no scope optics with such a small point. Yet another reason to not want laser. If your sensor is 2mm, the spot 1mm, over 100m distance you need to be accurate to a hundreth (top of head estimation) of a dergee to make it register, where as with a spot that widens slightly over distance you can make it "easier" to hit the sensor.
Any fast response light source can be modulated. Fast light sources are LEDs, Lasers and certain types of gas discharge. With a fully built laser module it is possible internal capacitances on the power will act as a filter, forcing you to use single-kHz-range modulation. If you're unlucky it might even force you into 100's of Hz, which would become annoying to fast moving players. So there again, pre-built red laser modules might be less preferable to IR LEDs for game-play reasons.
You can basically modulate the light any way you like. Many tag-games send a standard 8bit value over and over again, usually in a RS232 type signal, modulated with a higher frequency. Many modern day "higher-end" microcontrollers support that all out-of-the-box, since that's also how IRDA works and it's basically a proven scheme. There are standard frequencies, such as TV remote or IRDA, for which automatically filtering sensors (Samsung SHA series?) can be had. If you want to support an international community of players that sometimes meet, you can even start a sort of "unique ID" scheme with a 128bit number, so that you can always see who shot who and when, but that is maybe taking it a bit far?
