At which point does this become a huge fire hazard?

A friend has his own battery setup in a shed. He has a ton of sand above it which would collapse in the event of a fire.

I have 1000 litres of heating oil in my back garden which is hardly unflamable. 10MWh of fuel.

Can LION battery fires be smothered? Online articles are contradictory. Some say they can be smothered, but others say that they generate their own oxygen, and you need to cool the fire, some say to do both.

Heating oil in a tank is quite safe. It doesn't evaporate rapidly, and will not burn unless atomized or spread out. It won't explode unless provided with a much richer source of oxygen than normal atmospheric pressure air.

The cars in people's garages are far bigger fire risks. For example it's not uncommon to have a 70kWh+ EV battery, and the chemistries used to get the extra energy density for cars are far more unstable.

LFP (rarely used for cars) is fairly stable. And sodium batteries are even more stable.

Pretty quickly. There's also a point where it becomes a serious explosion risk too.

Every other fire you can stop if you're right there and you catch it. If a battery pack starts to go, you might have a few seconds before the local environment is incompatible with life.

Not all battery technology is as volatile as Lithium-Ion or Lithium Polymer, LiFePO4 for example isn't subject to thermal runaway, nor are some of the Sodium-Ion batteries (although it's dependent on the exact chemistry being used).

People are used to having 25MWh of heating oil tanks in rural locations, although those are supposed to be stored away from the house.

Assuming heating oil is diesel, it's not very flammable and not a huge fire hazard. Soil pollution from leaks and spills seems like a bigger concern there. But I guess some people have large tanks of LPG which might be a bigger danger?

Every now and again there's a black swan event: https://en.wikipedia.org/wiki/Buncefield_fire

Nobody seems to think twice about storing gasoline, heating oil, diesel, and/or propane around their place.

None of those release hydrogen flouride when they burn (among other things).

LFP cells are used in these batteries, they are not the same chemistry as the li-po you find in smartphones.