There has been some discussion on the academic blogs recently of the practice of citing unpublished work, and the practice of some philosophers of sometimes marking unpublished papers as "not for citation." Brian Weatherson weighs in on the issue here. For my part, I'm fine with anything I've ever presented to the public in any form being cited; the more often my name is mentioned in other peoples' work, the better.
I'm curious about the general standards, though. In my dissertation, I cite a paper Sarah Moss presented at a graduate conference, as while this was a couple of years ago, she seems not to have subsequently published the work (most unfortunately, in my opinion; the paper belongs in print).
I find it hard to see how there could be any damage to Moss from the citation, as I don't give away her secrets or present a devastating criticism or anything else of the sort which might make it harder for her to get her paper published in future (in the highly unlikely event that anything from my dissertation becomes well known in the philosophical community in the first place). But if there is any question about whether this sort of thing is generally acceptable, I suppose I should ask her directly. Actually, I may have already asked her; I know at one point some time ago I asked her to send me a copy of her paper, which she did, and I think I may have said or implied that I was planning to cite it. She sent me the paper and I'm sure I'd remember if she said not to cite it, but there's some chance I didn't ask specifically and she simply didn't mention the subject.
The citation is on a point quite secondary to the central topic of my dissertation, so it could be harmlessly removed; I actually mostly included it because I was so impressed with Moss's work and wanted to call attention to it.