From what I understand, higher oxygen levels were only linked to large invertebrates, not dinosaurs:
Some paleontologists speculated that oxygen might be behind the evolution of huge dinosaurs, too, but the hypothesis has been totally undermined by evidence from the geological record and dinosaur anatomy. Geochemical evidence has shown that Jurassic and Cretaceous air contained about as much oxygen as today, if not a little less. More than that, the dinosaurs did not need increased oxygen to adequately nourish their bodies.
As part of their respiratory system, sauropods had a complex network of air sacs that gave them two advantages.
Oxygen becomes toxic to humans at higher partial pressures. (That is already a concern to divers.)
I do not have the numbers in my head to tell whether dinosaur-era levels of oxygen would be enough to cause problems. And in any case, the oxygen level would take probably at least a few hundred years to rise.
Fun fact: The rate of oxygen production by plants is big enough to re-oxygenize the atmosphere to current levels in around 2000 years, should all oxygen be wiped off the planet. (Assuming everything else stays the same, including CO2 is kept at current levels.)
I'm reminded of a similarly circular phenomenon, known as "fairy ring," where mushrooms grow in a circle. They appeared on our lawn in Saskatchewan from time to time; apparently it happens all over the world.
http://en.wikipedia.org/wiki/Niche_construction
One of the most significant inadvertent "engineering" events was the biologically-induced oxygenation of Earth's atmosphere:
http://en.wikipedia.org/wiki/Great_Oxygenation_Event