How bad is it to breathe in rubbing alcohol fumes?

Depends: This will depend on the sensitivity of the individual combined with the concentration of the alcohol fumes. It could be anything from very mild headache, nausea to severe shortness of breath.. The answer is to avoid the exposure or improve ventilation in the area of use if you must. Severity will dictate which of these you must do.

Depends: Huffing isopropyl alcohol fumes (bag over the head, high concentrations) can make you just as sick as drinking it. The minor exposure to rubbing alcohol when you put it on your own skin, or are just working with it in a reasonably ventillated place, should not cause any problems.