I think Steve Irwin is taking similar chances one takes by crossing the street with a baby carriage except Steve has control over the object of danger. In crossing a street, you don't.
His croc was an old, half blind, well fed, predictible animal. Steve was in control all the way. Terri was right there as well. The risk was only as dangerous as the perception given and not actual.
Next time you belt your kid in the car and go for a drive, your kid is in just as much danger if not more. If you speed, you exponentially increase tha danger. If you live in a house with stairs, there is a danger as well.
If I was a little tyke like that, I would rather be in Dad's arms when danger is present than anywhere else.