What are the dangers of lead paint exposure?

Old bad paint is bad. Painted surfaces that are in very good condition are ok. Babies get lead into their bodies when their surroundings have old paint in bad condition. When leaded paint is cracking, chipping, or otherwise falling apart, the dust-sized particles may end up in a child's mouth or be breathed in through the nose. A child can have high lead levels, which are bad for his brain and harm his development.
Depends. Lead paint on walls or toys won't hurt anyone-- unless it's ingested. Touching or being in a room with lead paint isn't a problem. Lead paint was in wide use until the 1960's, so older homes may have layers of lead paint deep on the walls. If that paint is flaking, toddlers sometimes ingest it-- and that can lead to serious health problems.
Anemia. Lead paint from toys, cookware glazes, peeling paint, or even collected in the dust/dirt around buildings has been shown to interfere with red blood cell production, causing anemia.