You usually don't need to study all
of the specs... I guess the trick is to know what's important for your application and to just have general "feel" for what's normal and safe... The ATmega spec sheet is over 400 pages, and I probably haven't read one percent of it! When I'm unsure of something, I'll look it up.
If I'm using a 7805 voltage regulator to power a couple of low-power chips, I don't worry about the 7805 specs... If I'm working with something-k Ohm resistors (or higher) at 5V I don't worry about the power, voltage, or current ratings for the resistor. If Im getting down around 100 Ohms, then I'll calculate power dissipation for the resistor.
Output seems not to represent the output-signal comming from the sensor as "Output current", symbol Io, is 50 mA. I conclude this in respect for my experience, that my setup-output cannot turn a LED on.
A typical LED requires about 20mA, so powering an LED would be fine.
50% of the info in 'Absolute Maximum Ratings' deals with temperature and power-dissipation. That's usefull information if you've bought a boiler or sausage-fryer.
There's a reason for the power specs... As you may know, power is calculated as Voltage x Current. Under normal operation as a switch, the output transistor either is switched-on with current through it and nearly zero voltage across it, or it's switched off with voltage across it but nearly zero current through it. Under either of those conditions output-power is essentialy zero and we don't have to worry about it.
However... What happens if the light path gets partially-blocked and the thing turns "half-on"? Now, we have voltage and current at the same time and we are dissipating power. If we have happen to have a situation where we have the maximum current (50mA) and
the maximum voltage (17V), at the same time, we are dissipating 850mW. We we have exceeded the maximum ratings and the thing might burn-up (or otherwise fail).
As far as temperature.... Temperature is related to power and it's the total temperature that's important. Thet means the heat generated internally by the device from the power dissipation plus
the external ambient temperature. Your circuit/device might work fine in a normal room-temperature environment, but it might burn-out if you use it in a non-air conditioned environment in Arizona in the summer.
But again, this is not
something I'd worry about when the thing is operating "normally" as a switch.