An initial assessment is essential regardless of the class size. I always meet with my first time bootcampers and put them through a short bootcamp workout, measure them, and review their forms, this takes approximately 30 minutes of my time but it is very important to me.
As for personal training clients, i spend 90 minutes initially doing a full assessment.
For group exercise classes I would always talk to new people prior to class and would show them modifications if need be.
As always, release forms, PARQ forms, need to be filled out. If you cover your concerns with these forms you will have information at your fingertips.
I think that coming from a world of just one on one training to effectively training small groups is pretty difficult because we have to give up some of the control. During personal training its much easier to tailor every partof your time with one person as opposed to factoring multiple personalities, limitations and goals. With that being said, I do think a screening process like the FMS offers a very simple, effective, and low cost answer to keep small group training personal.
I think the key to FMS is that it has very definitive and simple grading system. All you have to is take a few minutes and show people what to see and have them mark a score. This could bea available totl advantage to your program because people can be broken into smaller groups based on skill level and be given their individual appropriate exercises instead of just doing what TN the Web majority is doing. Think about how you could do this. You could treat it almost like a karate class and have like a color coded belt system. You could have people graduate from one level to another and be rewarded in some way.
If nothing else it makes the sessions much more personal and safe.
Hope this helps,