first - If you short the battery cable, the arc will be similar to a arc welder, BE CAREFUL! Wear PPE, gloves, long sleeves, face shield, etc...
Second - What do you call it when you strike a match? Or your car 'burns' gasoline to run the motor? It is a chemical reaction that releases energy. Smoke and heat. A venting lipo often has a gas jet several hundred degrees hot, and it will even give off light. It is not using oxygen, but it is 'burning'. And yes, anything around it will catch on fire too. The fire hazard is real.
Last -
Second - What do you call it when you strike a match? Or your car 'burns' gasoline to run the motor? It is a chemical reaction that releases energy. Smoke and heat. A venting lipo often has a gas jet several hundred degrees hot, and it will even give off light. It is not using oxygen, but it is 'burning'. And yes, anything around it will catch on fire too. The fire hazard is real.
Last -
As I said above, lithium fires are like magnisum fires - they don't rely on oxygen as the fuel, so you can't smother them. Also, if the ammo can is really sealed good, it will build pressure inside until it goes Bang. So you ammo can needs a vent. You can drill a few small holes, or, what I have done, I use removed 3 sides of the lid gasket. I just left the front of the gasket, so the does not ban closed, and the gasket acts like a spring for the latch to work against. The other three sides are gasket free, and will vent any pressure, if there is ever a lipo fire in the box.Not sure if an ammo can would smother a lipo fire But It Is Air TIght.