I've also been thinking about this a lot lately..
I like to think I'm an honest person and I genuinely am an honest person actually. If I don't like something I usually try to point it out and I like to give my opinion even if its cruel, in the end, words don't hurt.
I know this one guy in my year level who is extremely confronting and to be honest, if I was talking shit he'd blast me with the truth and be confront the living hell out of me. I actually like this, opposed to being friends with other people who probably think lowly of me however don't have what it takes to actually tell me.
Also I agree, we do live in a society where words are extremely hurtful and people are so sensitive to words. I think the major contributor to this is dishonesty, really. Too many compliments are thrown around and people are just trying to avoid their weaknesses and flaws, however when someone points it people get so sensitive. I have quite a few flaws myself and I don't like it when people act as if they're nothing, I'd rather people just ignore it or be brutally honest. Man, I really hate it when my mum says something like "oh don't worry, it wasn't that bad" for example if I was to do a speech and when in reality it was shit. I'd rather my mum say "that wasn't the best, you were nervous and didn't do the best speech but you can work on it".
I don't know many honest people in my life, including my family. They're not really exactly honest with me, like, they try to be extremely nice and compliment me, although I'm more of the judgmental type who would want to point out the truth opposed to hiding the flaws.
Anyway, apart from me blabbering on about rubbish, my opinion is that yes it is possible to be completely honest with someone however I've never had that kind of relationship with someone before. I think it would be good to have a completely honest relationship, just because you know that the other person is going to be honest with you and you wont have to wonder what the other person is thinking.