I was on another site and they were talking about tea tree oil toxicity. I googled it and it does seem to be toxic (especially if ingested). This applies to cats but sometimes in dogs also.
http://www.vet-task-force.com/Abstract-tea-tree-oil.htm http://www.exoticbird.com/gillian/teatree.html
Then there are plenty of sites that say it's safe.
Food for thought...