The most common data point seems to be that any moisture level below 35% will inhibit growth of the C. Botulinum spores that cause botulism. It's hard to point to true scientific sources because they tend to be protected, but if you spend a few minutes on Google (try this query) you'll see that it is in fact confirmed in several of the scientific journals.
I seem to be seeing snippets of references (which I can't view the full text of) that suggest possible growth at moisture levels as low as 16%, but most garlic flakes have 6% moisture or lower, which is way too low for botulism.
If you are seriously concerned - perhaps you live in a very humid climate and don't have air conditioning - then toss a desiccant into the container to be sure that the moisture level stays down. The most popular are those little packets of silica gel (don't open them!), but there are many more - see Wikipedia's list of desiccants.
Honestly though, chances are your flaked garlic is already free of C. Botulinum spores after the dehydrating process, and nothing's going to grow no matter how you store the dried stuff. The above paragraph is only included for the hyper-paranoid. Powdered/flaked garlic is safe to store at room temperature.
If you're actually storing this garlic in the oil (it's not entirely clear from your question) then that's another story, and theoretically you're making it possible for the spores to grow again. So it comes down to a question of whether or not the garlic flakes are already clean. That's extremely likely to be the case, but not a sure thing, and personally, I don't know if I'd chance it; best to follow the same precautions as those for fresh garlic and soak them in vinegar for 24 hours to kill any spores (although you might as well use fresh garlic in this case).
As a health inspector for over 20 years, I am astounded by the lack of awareness that food safety controls are based on science and not on individual inspectors' personal fears and bad moods. Botulism control is based on some of the following facts: botulinum spores are commonly found in soil and on vegetable surfaces, botulinum grows in low or no oxygen envt., botulism has high virulence. (Virulence is a technical term for the fact that a high number of botulism victims end up dead (like Listeriosus of raw milk fame), in contrast to other food borne illnesses like Staph or Campyllobacter.) When considering the fact that botulinum grows slowly, and food borne illnesses whack people more often with weak immune systems, such as the elderly, the ill, and the very young, the food producer may have just been lucky that the product never created a problem, or the very real option that a problem was never narrowed down to the product.
As to the argument that old time recipes have been made for centuries, as in this case, (I am a bit of a foodie and Italian), the big difference is that many products were never made for mass production and or to stick around on shelves for long periods of time, and if so, any data, let alone food safety data, is unavailable for historic food products. In fact, the link between bacteria and illness was scientifically proven by Koch as late as the late 1800's. Another fact is that the CDC's data shows that outbreaks over the last 50 years are fewer, involve much higher number of victims and are more often associated with mass production and distribution of food. My health dept. receives notices of food recalls at least once a week.
In the case of botulism and fresh garlic in oil, it's considered so risky that acidification is required nationwide. In California, there is a state lab that specializes in evaluating botulism safety for commercial operations. (It's funded by taxes to keep cost to businesses low and is considered a public service.) I would recommend that producers contact their State health depts. and work with them to identify any and all options available for the canning and sale of any low acid food - including acidification, using dried ingredients, temperature control, flash heating (called a "kill step"). The majority of us inspectors truly focus on how to sell food safely and do not approach their jobs as stopping people from making a living. And surprise surprise we don't always think alike, just don't get me started. However, I'll finish with the following consideration of the implication that "life has it's many risks" argument that we inspectors hear often. When it comes to death, the public, the politicians and the members of responsible industry itself does not tolerate "a little death."
Best Answer
http://nchfp.uga.edu/how/freeze/garlic_oil.html matches the USDA statements I have seen which says for home use, garlic oil should be made and used fresh, stored at 40 degrees for no more than 4 days. That of source addresses only the safety issue and if botulism is considered a risk or not. As Jent suggests, garlic powder, may be an option, or even dried garlic which rehydrates in the oil might be a safer option. Commercially available garlic oils tend to be considered shelf safe, but those have been likely heat and pressure treated, possibly chemically treated to make is safe, but attempts at this are not recommended at home.
The USDA recommendation I have seen is to mix the garlic and oil and then freeze that in cubes or sheets. The claim is this will remain semi-pliable, but when I have done it, it froze fairly hard but soft enough I couple cut pieces off to use. It worked fairly well for me.
I have seen sites claim that storing fresh garlic in oil is safe, but the USDA disagrees.
ETA: On the question of if it is safe to use powered or dehydrated garlic to make garlic oil: From my looking around, I could not find an authoritative yes or no. Others might have more luck. Dried itself is considered safe as everything I found said botulism cannot survive low moisture. But the spores can. There seems to be disagreement of weather oil provides the moisture needed for the spores to activate though. Commercially treated product likely is subjected to higher temperatures and treatments to cover this, but that is a statement of likelihood, not something I found lab statements to back. Also, the type of oil may matter. I would think that a high quality olive oil might be more susceptible to growth as it is a pure vegetable extract, than would a refined and heat treated oil. But again, that is just using my logic, not backed by tested evidence.
I have purchased commercial garlic infused oils, and personally, I would go with the frozen or freshly prepared. The commercial versions had clearly been heat treated as the garlic flavor was barely perceptible for the amount visibly in the oil. But I like a strong garlic flavor, not subtle.