OK, I get what you're talking about now.
A flashlight, regulated or not, will draw a certain current running off a certain battery -- for regulated, it's conveniently the same for all batteries (so long as it's in regulation), but unregulated will depend on the battery's internal resistance. Assuming that current is known, the question is, how do you know you don't overload batteries with it.
As you observed, with batteries shipped with overcurrent protection by the manufacturer, you know that protection is set somewhere on the safe side of :poof:, so it's not much of an issue. For batteries without overcurrent protection, we need to know what currents are safe, and either add protection at or below that level, or at least make sure our light doesn't draw more (although that doesn't help with accidental shorts and such). How important the protection is depends on the consequence of overcurrent, which varies by cell chemistry.
You can get that data from the cell manufacturer in many cases, even though you're getting the cells from a battery pack put together by a power-tool maker -- there's often sufficient markings on each cell to determine exactly the manufacturer and part number, and you can look up operating parameters from the manufacturers datasheet. Even if you can't tell the exact model (IIRC, there were some green-wrapped 18650s in the same chemistry from Sony and another maker that were tough to tell apart), if you know the chemistry and capacity, then you know almost exactly what the limits are, and can certainly set "safe" limits that you know will be fine.
If you don't look up that data (and you don't need to hunt it all down yourself; LuxLuthor has collected a lot of it
here), you could wind up overloading a cell by using it in a light that draws too much current. The effect varies depending on the cell chemistry. Even if the light's regulated, it's my understanding that this
still creates high risk of fire or explosion with LiCo cells, through a
chemical runaway process; once it starts, it'll go even if disconnected entirely. But most of the cells stripped from packs are one of the various safe Li-ion chemistries. (After all, it wouldn't do to have battery packs exploding when someone stalls out their cordless drill :D, and the safe chemistries also handle higher currents with no harm at all, allowing higher torque from a given capacity pack.) It's my understanding that overloading them will just kill the battery prematurely, but it won't take you (or your light) with it. The fact that abusing these "safe chemistry" cells doesn't turn them into bombs is why they may be much more comfortably used with no protection circuit.
(Finally, the batteries usually scavenged from packs are 18650 and bigger, and can safely supply at least 10, and typically 20 or more amps -- it takes a
very serious flashlight, with a runtime of less than 10 minutes, to risk overdrawing one of these. The "best" cells, from a current perspective, could be safely drained in as little as two minutes -- about 100W from one 18650 cell! and charged in about 15 minutes. Most hotwires are nowhere near that aggressive, so there's adequate headroom on currents.)
To the general question "How can the cell fail?", there's also overdischarge and physical damage when in the light, and bad charging (overcharge or trickle charge), short-circuiting, and physical damage when out of the light; I assume you've got a decent handle on those, so I won't elaborate further.
