Alvin Starkman wrote a great article illustrating the safety of Oaxaca, Mexico, which is currently posted on Suite101.com. The article does a great job of reminding travelers concerned by intimidating news reports to always check the dates of the events being reported (as many of the condemning reports date back to 2006) and to always check the credibility of the source.
For those looking to travel to Oaxaca, the article also gives tips on how to find unbiased information about the safety of the region.