Well, Sara, I'd say when O Sensei said Aikido is Love, he didn't have the Kama Sutra in mind... that said, I don't think it really adds anything to the dojo or the experience for two folks (student-student or teacher-student) to be dating, but if they are mature (sometimes a big IF) there is nothing detrimental in it.
They should be realistic about what they will feel and do if it doesn't work out--- often, someone in the pair leaves the dojo. Not that that is what SHOULD happen, but it is a sad reality that usually one of the two didn't want to see it end at the same time the other did, and feelings are hurt too much to see each other once the romance is gone. If this is the only dojo around, think about what that may mean.
I see nothing wrong in my fellow students dating each other, or my instructor(s) dating each other or a student (adult goes without saying). The only ones who've asked me out from any of my dojos were ones who were unsuitable for other reasons anyway... not sure what I'd do if any of those to whom I've been attracted had asked, probably try it.