Kevin,
The "rule of thumb" is that the stem should be inserted at least 2" into the steering tube.
The real issue is that the expander portion of the stem should be located below the threads on the steerer to prevent cracks from forming in the threads.
That said, there is also the issue of what kind of stem are you talking about. A steel stem would probably not have any problems if the expander was located below the threads. Forged aluminum stems are usually a lot stronger than most cast aluminum stems.
Check out this link to a message that I posted recently where I discussed cast aluminum stems.
http://search.bikelist.org/
Chas. Colerich Oakland, CA
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