Yeah that's pretty crazy. If the battery produces gases like that, shouldn't it be vented?
Run.
When I was a teenager I used to race RC cars. The things had pretty hefty NiCd an NiMh cells. Occasionally one would vent and catch fire in someone's car or more usually attached to a fast charger.
Flames, smoke, nasty chemicals spilling out and everything for about 2 feet in each direction pretty much destroyed or covered in chemical gunk.
Now there are LiIon and LiPoly cells with an even higher energy density and discharge rate. If one of them goes, I'm out of the place. I trust a 240v mains line over those things.
Typical outcome (artificially started with a hammer):
Run indeed.