Sleeping in a fully sealed bivy sack is indeed dangerous. There are real case reports of people dying inside their bivies. Asphyxiation was assumed in these cases - (I have never seen a coroners report verifying the cause of death) but I think this is a relatively good assumption.
The reasons below may help explain why this is a bad idea, but they are conjectural, I haven't seen any good studies verifying these issues (if anyone has please let us know)
Firstly, in sub freezing temperatures the water vapour will freeze in and on the bivy material making it in essence completely air tight. Obviously this is not a good time to be fully enclosed in your bag.
Secondly, in above freezing conditions the question is, will the breathability of the particular fabric allow enough air exchange to support your respiration. For example, you could take a cotton bag or clothing, put it over your head and continue to breath just fine. Now try this with Event, Momentum, Goretex or any of the breathable materials - you have to blow and suck really hard to get air to move through the fabric, and even then you can't get enough air to survive.
Thirdly, in above freezing conditions water vapour condensing on the surface may impede breathability too. Certainly, using the above example, if you wet the cotton you will no longer be able to breath through it. It is possible a layer of condensation on the breathable fabrics will impede diffusion of air (although these fabrics are much more hydrophobic than cotton, at some point the pores are going to be saturated with vapour.)
Again this is all conjecture. It would be interesting to do some studies and monitor the actually CO2 and O2 levels in a sealed bivy. Perhaps this has been done, anyone know?