A new feature for the iPhone allows users to easily "check-in" their location through Facebook Places. Using the GPS on the mobile device, Facebook logs where you are when you check-in and even allows you to tag friends that are with you. As Facebook learns more locations, checking in while at friend's houses will intelligently connect your location to that friend. Currently only the iPhone will have this feature, but soon enough other smart phones with the Facebook app will catch up.
Seemingly, the decision to share your location is up to you, but considering Facebook's history I'm not sure I should trust that.. than again maybe they've learned. Of course, again in Facebook history the privacy of it's users is being brought into public scrutiny even though other websites such as Twitter already offer location features like this as received much less flak.
There has always been privacy concerns with the internet all the way back to simple bulletin board websites then chat rooms. The simple solution is to limit the information you put online and assume anything you do is available to more people than just who you gave it to. Although internet security has gotten better, more people are flaunting their personal information around the web then ever before giving scammers and identity thiefs a lot of incentive and material to work with.