I always thought it would be wierd, but I decided to try it. At first it looked good but after a while I realized that it looked kinda fake and made my eyes look smaller...but that's just me. It did get the eyeliner into my eyes much more, make the eyeliner run and smudge more (so it looked like I'd been crying), and my eye whites got darker and reddish. So I didn't have a good experience with it, but maybe that's just because of the eyeliners I used or something. You can always try it out and see if it works for you. One good tip is to use a q tip with eyemakeup remover and swipe the area under your waterline once your done lining. then its like a perfect, clean line.
From what I've been told, it's safe as long as you wash it off at the end of the day. Don't let it clog up your tear ducts at the corner of your eyes, because that might cause an infection, but that's pretty easy to take care of. But yeah, it should be perfectly safe; I've never had a problem with it.
if you must, use a pencil, but ALWAYS clean the pencil (shave a fresh layer) since any bacteria can lead to pink eye. And be careful, that's a very sensitive area. But in my opinion, when you put it on the waterline, you make your eyes smaller- and isn't the point of liner to enhance and add shape to your eyes, not make them look tiny?