It's more to do with excessive cylinder pressure, though back-fires can happen, but is more common with the "wet" system, due to the poor fuel distribution leaning out a cylinder, then BANG, back fire just as you would expect from a lean cylinder.
As for running a dry system with a turbo, it's only a problem if you are a manufacture of kits, mostly because turbo cars are too easy to turn up the boost, if they had to keep the boost stock, it wouldn't really be a problem because you would know that you would alway be able to bump the fuel pressure to a specific level and have the fuel that you expect. The reality is that no one keeps the boost stock!
So, you never know how much fuel you'll have to work with. It won't even factor in for me because it'll be off before I'm making any real boost, so it's pretty much the same as if it were on a NA engine.
If you plan on running a dry kit (boosting the fuel pressure to get the fuel for the nitrous system), then you have to figure you'll be a bit rich before the boost comes up. These systems work by sending an artificial boost signal to the FPR, telling it to raise the pressure by 25-30PSI over static (no boost, no vacuum), that's about as much as you can count on from a good fuel pump and is about the max opening pressure of most fuel injectors (80-85PSI gauge). The problem comes in because you have to count boost, each PSI of boost takes away a PSI of "extra" fuel for the nitrous system, so you can start running out of fuel pretty fast as the boost comes up. In my case I'll see as much as 25PSI, that's almost all the "extra" fuel pressure a dry kit is made to add, so if I tried to run it like it would be on a NA car(all the time), I'd be ok
until the boost came on, then I'd have almost no extra fuel!, and in all likelihood, 4 new ashtrays!
And since I don't smoke, that'd be pretty useless! If you don't run too much boost, then, like I mentioned above, you'll be rich at first, the it'll lean it's self out as the boost come up. Though "wet" systems suffer from poor fuel distribution, they are much simpler to deal with on turbo cars, in either case, we have to take care to not get too greedy (an easy thing to do). As an aside, a "wet" kit's tendency to have problems goes up exponentially as it's HP level goes up, in short, you're very unlikely to have a problem with a small hit (35HP), but very likely with a large hit (150HP). Also, those HP number will be a bit low as they are rated on NA engines so the added intercooling effect and quicker spool (and sometimes added boost pressure) are not factored in, so you might be surprised at what a "small" hit will do for you!
BTW, if you normally run the alky, keep it on when you run the nitrous, it provides some anti-detonation protection and you don't want to handicap yourself in that regard.
Mike