ISTM this would do more harm than good. An introduce a new requirement for all iterators, introducing new arbitrary limits and slowing down all iterators (this is currently a simple, fast, light-weight protocol).
Also this seems to be just a CPython issue (the JVM manages its own stack). Please don't muck-up the iterator protocol over this non-issue. It isn't worth it. If someone wants a stackless version of Python, they should use a stackless version of Python.
There are other crashers we choose to ignore (involving gc.getreferrers, bytecode hacks, ctypes, etc). I think this should go in that category and I would be happy to add a note to that effect in the docs for itertools.