Is this one of those things that unless you've been taught by an experienced person and you know what you're doing you probably just shouldn't try? If I did want to try, what precautions should I take? Is this a valid cooking method or is it mostly just done as an impressive visual effect?
Flambe is a valid cooking method. It allows you to flash off most of the alchohol from your chosen liqour but keep the flavour.
I'd suggest that you have a wet towel at hand or a fire blanket in your kitchen if you're going to embark on this cooking technique as a first timer.
Also don't run your extractor fan above the cooker if you're using your hob. You have the potential to draw in bigger flames and ignite any grease present in your filters or pipe to the outside world. My brother worked in a professional kitchen where this happened. They couldn't get the extractor turned off for a while due to the resulting fire and they managed to light up a good length of the extraction pipe to the outside. It was like the after burners on a jet engine. There was a fire appliance involved that night.
Ultimately it's all about common sense because fire and alcohol are a fairly dangerous combination.
Make sure you keep a fire extinguisher handy, and make sure that it works. It never ceases to amaze me, the number of people who don't have one in their kitchen.