I can't see an IR remote LED on my iPhone, so I'm not sure the phone camera means much.
If the LED has current going through it (measure the voltage across the series resistor) and the voltage across it is normal, it's virtually surely emitting light.
If the voltage across the LED is significantly less than expected for the current, the LED is fried. Some LEDs have more than one "fried" mode (sort of like medium-rare and well-done).
If the LED is drawing no current and thus has the supply voltage across it, it's either been severely damaged or is connected backwards. Curve from the datasheet here:
IR as used by most remote controls is modulated at 36 (sometimes 30 or 38) kHz: the IR LED is switches on and of at 36 kHz. That is the 'active' signal. At the receiver a 36 kHz filter is used, much like the tuner of a radio, to filter out al kinds of interfering signals (TL tubes fo instance generate a lot of IR at 50 Hz).
On top of this, the active signal is switched on and off acording to a protocol. It must has active and inactive moments, otherwise the receiver will not recognise it (its atomatic gain control will see a constant active 36 kHz signal as backround noise).
The most common protocols are RC-5, Sony, and NEC (also used by Apple). The protocols each have a specific (and totally differebnt) way to encode the bit pattern that represents the keys on your remote. To add to the confusion, the mapping of keys to bit patterns als varies widely, even with the same protcol.
Interestingly, the protocols also differ in how they handle a key that is pressed down for along time. IIRC Sony simply repeats the same bit pattern, RC-5 does likewise but toggles one bit, and NEC sends (after the first keypress signal) a 'repeat' signal that is the same for all keys.
IRDA is a different protocol that also uses IR signals, but without the 36 kHz modulation, and at a much higher data rate, and for shorter distances. It was mainly used to connect hand-held gadgets, either with each other or with laptops. I don't see it used much these days. (Anyone interested in a reel of IBM31T1100A IrDa transceivers?)
Best Answer
You could insist that users wear IR protective goggles.
If you don't really need that narrow angle (6°) that the SH4550 offers, you could also use a different LED that has a broader angle. The intensity also drops with the square of the distance from the LED.
Here are some detailed safety guidelines for IR LEDs. Remote signals are brief and pulsed, so the allowable power level for your application may be higher than for an IR illuminator.