No no - you're missing the point I tried to make earlier. The chip itself is designed to run at the higher speed, yes, and hence increasing it to that speed in the proper scenario is also safe.
However, the chip may not be designed to run at that speed with no cooling at all. If you look at other devices that use the Qualcomm MSM7201A ARM11 you'll see a whole bunch of them have boxes with heatsinks and fans.
Also, underclocking a chip is a common trick to get a more powerful CPU to run at a tolerable temperature without heatsinks and fans. This is, in my opinion, the most likely reason the CPU is underclocked. Obviously I didn't design the thing so I can't state this for certain.
So, what I'm saying is: HTC designed this phone to run with this CPU at the lower clock speed. The heat disipation, and power rating of the various components were designed with this lower clock speed in mind. Overclocking it will allow the CPU to produce a heat level and demand a power load that exceeds this design. As such, you risk damaging the components around the CPU by drawing too much power through them, you risk melting the printed tracks on the board, and you risk causing heat damage to the CPU and phone.
I'm not saying the CPU can't run at the higher speed, nor am I saying it exeeds the manufacturer's specification. What I am saying is that it exeeds the PHONE's specification.