X-Prize Cup Site Chosen: New Mexico
savuporo writes "MSNBC reports: "The X Prize Foundation and the New Mexico Office of Space Commercialization are joining forces to stage the multifaceted X Prize Cup, a two-week-long event that allows for privately financed, passenger-carrying space vehicles to compete for prizes.' The first Cup is expected to be held summer, 2006, while 2005 will probably see a 'Public Spaceflight Exposition.'"
Teams competing for the X-Prize ARE starting out small. The spaceship required to win the competition only needs to carry 3 people. The competition can be won by a ship carrying only one pilot and ballast representing the other two passengers.
As far as I know, Scaled Composites is the only team carrying out manned tests of their vehicle so far. They're following a careful test program, slowly expanding their flight envelope, and are taking no unnecessary risks.
For another team's perspective, check Armadillo's website for a great log of all the testing and refining they've been doing while developing their rocket.
Bottom line: The teams with a shot at winning are not jumping into rocketry without careful attention to safety. No one wants to see fatalities or explosions of any kind - they're bad for business.