Racing does continue at the old Nurburgring. Racing in the old "dangerous" F1 cars such as the Lotus 49 also continues. The fact that we now have sensible safety precautions such as crash helmets, fireproof suits etc does not negate the fact that these cars are still racing and the old circuits are still being used (modified where possible).
F1 safety didn't improve because of some profound set of morals or care for the drivers, it improved because drivers dying made for bad press. The initial safety improvements were pushed by competitors, but it wasn't until the death of Senna in 1994 that F1 began to take safety as seriously as it does today.
Personally, I think you'd have to be insane to compete in the TT, but I also think you'd have to be insane to compete in myriad other sports and activities. I wouldn't presume it was my duty to ban them however since they do no harm to society at large.
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