I dont think any thing substantial has changed as far as burning technology is concerned. Ideally, when LPG/CNG is burnt, by-product should be carbon dioxide, but at times when combustion is not proper, CO is produced.
In my hometown also, when we bought the gas gyeser, we were not aware of this issue. Later on we made it a practice to fill in the bucket with hot water with the doors open..and then go for a bath.
Knowing mumbai's climate, 5-7 mins of hot water should be enough for two buckets of warm water for bathing...so if space is a real issue and there is absolutely no scope of putting the geyser outside the bathroom, go for it, but get into the practice of filling in hot water before you start. (Low tech,zero cost solution)
In case this is not possible, you may also consider installing an exhaust fan and run it whenever you are using the geyser. (Cheap and workable solution)
Alternately you can install a CO detector in the bathroom. This device will sound an alarm whenever certain amt of CO is detected (high tech and better solution)
Moreover, running the geyser for 5-10 mins will not produce enough CO to kill/knockout anyone. Its an issue if its used for longer duration.
You can certainly live with it as long as you understand the equipment and its limitations.
FYI:
Citizen Matters: Water heaters or silent killers?
Take safety measures while installing gas geyser - Oneindia News
LPG water heaters blamed for a dozen Bangalore deaths
Gas geysers become silent killers - Page2 - Bangalore - City - The Times of India
Regards,
Mohit