Yes I have, but it really is not an HID issue per se, but a byproduct of wannabes trying to look like HID's. I am an EE so I have some knowledge of the eng'g issues here. The policemen have likely seen clapped out Civics running those "blue light special" bulbs which have caused wiring to be damaged and possibly sparks/fires. It has nothing to do with HID's.
Most of the melted wiring has been caused by people using illegal, non-DOT builbs with wattage ratings much higher than the 45-55w bulbs normally found in modern headlights (halogen). Some are over 100w!!! Ohm's Law establishes that the 100w bulbs will draw much higher current, and when the higher current is added to multiple lights (such as adding 100w foglight bulbs to the same circuit) the wiring rating can exceed the draw that the wire gauge was engineered to handle. The results - higher resistance in the thinner wire causes it to heat up, and in some cases enough to nelt the insulation. If the exposed wire touches metal, a spark is likely, and that spark can ignite flammable liquids or cause flammable materials to burn.
HID's run at high voltage, but low current. They actually consume less energy than conventional halogen lights, even thoough their output is greater. The danger with them is remote:
1) Finger oils can cause a hot spot and the HID bulbs can shatter
2) The step up devices needed to raise battery voltage to the high voltages needed to ionize gases can cause nerve damage if touched by someone poking where they shouldn't be poking.
All HID conversion kits I have examined have the right components to ensure a safe install - if someone is out of their league or bypasses proper parts, then ANY aftermarket part can be dangerous. I am not aware of a blanket ban on aftermarket HIDs.
HID's in Wisconsin are technically illegal. It's so stupid. So are "open airbox induction systems." The GT500 has an open airbox from the factory. The only thing that supercedes these rules is if the part is OEM. So is modifying exhaust from OEM. Now while that's no surprise, what is a surprise is that there's no dB limit so you can technically get pulled over for making your car QUIETER or not having an OEM muffler if it, say, rusts out and you get a replacement that makes your system have the exact same sound intensity. Do the police enforce any of these stupid laws? Not that I'm aware of. I've never seen it, anyway...