What are some of the dangers of mishandled dialogue?
Your characters will be out of their very own character and / or you misguide the reader.
Do y’all have rules of thumb when it comes to dialogue?
Yes. I also prefer complex sentences which sound realistic instead following the standard rules of the 21st century where every sentence must be an artificial, simple sentence, like if you would have a vocabulary of 500 words, no more. Simple sentence structures are never going to let you to explain a bit more complex storyline or present an intelligent character as intelligent.
AND (this might be a weird question)
Is there something to be said for how dialogue looks on the page before the reader fully interacts with it?
As above... realistic and not artificial. For example what you should avoid...
"I'm going to use this talisman to destroy the world." - Over explained cliché dialogue, combined with simple sentence structure (Especially if the bad guy is speaking in himself.). So sometimes it's better if your character simply stays silent and not going to explain everything to the reader via these sort of dialogues.
Another cliche, simple structure example.
"I'll kill you!". Another cliché, simple structured dialogue, which is used to appear where it's evident (Usually where the antagonist is willing to kill the protagonist. These sort of sentences used to appear when their weapons are already prepared.).
"I'm doing this to... (Add cliche: take revenge, save the world, destroy the world)... because... (Add cliche: I had a loosy life, I had an evil mentor, the voices in my head are telling it.)" Another simple structured dialogue, where the writer feels the necessity to explain each of the acts, loose story arcs with some dialogues (The worst is when no one is asking the evil about his motives at all.).
And the worst combination, making your characters deaf whose are asking back every single sentences... examples...
“Yer a wizard.”
"I'm a what?"
“I’d like ter see a great YX like you stop him.”
“A what?”
"Would you care for a lemon drop?”
“A what?”
Another simple structured sentence, where there is no problem with the first sentences, but the second part is already a forced element, which is not necessary (These three sentences are actually from the very same book. In this book it wasn't really a problem as only these three appeared there as I recall. But there are novels where the writer is using this, "A what?", or other forced "The 2nd character is asking back" more than twenty times to force the other character to explain everything.). Sometimes these sentence structures are necessary, because there are things what about the readers never read before. But where the answer is evident and the surprise can be presented with reactions and expressions, in those cases it's truly unnecessary to force simple structured dialogues.
Simple structure also can be forgiven if the story is written on that way (i.e. hillarious stories). Such as Harry Harrison's Stainless Steel Rat series...
"WHERE ARE YOU GOING, Slippery Jim?" Angelina asked, leaning out of the window of our room above. I stopped with my hand on the gate.
"Just down for a quick swim, my love," I shouted back and swung the gate open. A .75 roared and the ruins of the gate were blown out of my hand.
"Open your robe," she said, not unkindly, and blew the smoke from the gun barrel at the same time.
I shrugged with resignation and opened the beach robe. My feet were bare. But of course I was fully dressed, with my pant legs rolled up and my shoes stuffed into my jacket pockets. She nodded understandably.
"You can come back upstairs. You're going nowhere."
"Of course I'm not." Hot indignation. "I'm not that sort of chap. I was just afraid you might misunderstand. I just wanted to nip into the shops and . . ."
"Upstairs."
Here, the simple structure works very well, because it's giving a really good pacing for the dialogues itself, while the author is explaining the necessary elements in the descriptions. Here there is a chemistry between the two characters, while none of them is asking back and none of them demands any answers (So the characters are also capable to connect the dots in their mind, so as the reader. The first character is giving an explanation, but it's also a false excuse as the reader is capable to figure it out from the dialogues and the descriptions.).
I can sort of answer the last question - readers like white space - the kind created by dialogue. It feels like there's less of that tiresome book-lairnin'.
As a reader if I like and waiting for these sort of white spaces in a book, that means I already have some or great problems with that novel. If you want to grab the audience with some white space, there is a great problem with the novel itself as you can't misdirect the reader's attention. When you're reading, your attention must be misdirected and hooked page by page. If you can't do that, these white spaces are good to ease the pain of the reader.