The key is that shaving the tires reduces rotating weight. For monster trucks it's easier to get a lighter tire spinning quickly, better hole shot. Tractor pullers do the same thing.
Burt Munro shaved his tires........at least in the movie. Theory is that the weight of the rubber would actually deform the tire at high speed.
Never heard of it. The safest way to ride is with my tires firmly attached to the road so I'm not about to do anything that might disrupt that connection. If you're looking for a little more speed maybe you should try a crotch rocket.