BTW, thanks to everyone for their excellent, thoughtful replies!

Zaxo, re the specific issue you raise, I don't think an onlin format is appropriate for quizzes that are high-stakes, but for a low-stakes quiz, I think it might do the job. Also, most people doing this kind of thing use a big bank of questions, so no two students are taking the same quiz. A bigger issue, from what I've heard, is that if you're using the quizzes to arm-twist the students into doing the reading, they may take the quiz with the book in their laps, without having read it first!

To me, the big security issue is simply making sure students can't crack the system and change their grades at will...