> A toxic graduate school environment is worse than most toxic work environments
I agree with this 100%. I would even extend this to overall academia pre-tenure (and maybe tenure as well). Moving to a different employer is usually easy and non-traumatic; in PhD program you are stuck -- leaving will mean abandoning your half-written thesis and starting from scratch, etc. Thus it is critical to avoid bad programs, either with a toxic environment or those that treat grad students as long term slaves.
> A lot of places aren't (expand) ... with vast majority of smart and good people. ... You can be worked 100 hours a week. You can be blackballed for getting sick, for taking vacations, for taking maternity or paternity leave
With this I disagree. I had friends in many schools and while there were a few exceptions by and large the environment was very good: supportive and enabling without kid gloves. I was on the theory side, which surely made things easier (no expensive hardware or purchases to pay for), but I basically wasted third year of 5 of my PhD on aimless wandering: I could get no traction on any problem, would try something and drop it at the first challenge, etc. And I heard no complaints from my adviser -- he was checking in, asking if I want feedback or suggestions on problems to look at, but otherwise let me be. No 100 hour weeks, etc. I knew he was not thrilled, but he let that disease (or growth) run its course.
I much later spoke to other folks doing theoretical PhDs and found that this is not that uncommon: transition from doing great in classes (learning along an externally designed sequence) to planning and doing your own research may not go smoothly.
I would speculate that this is largely because students spend most of their attention on pre-planned classroom-like work and do almost no research-like work during the first 16+ years of their formal schooling.