Not sure about fire (especially on this low power of a board)... but it's definitely not ideal. Just a thin layer of rubber (like a mat for kitchen cabinets cut to size) would be better if going for this sandwich style layout.
The CPU reports a max temperature of 49C during my testing. I don't think it's that bad, but I'll take your comment into consideration, a cheap case to cover it is probably better than taking that risk.