With the number of mentions of Facebook, and the apparent number of people already there, an accidental connection that I stumbled onto might be of interest. A friend who recently "signed in" there commented on the settings being a bit confusing (or maybe the term used was "ambiguous.")

The AV producers at Sophos have provided some suggestions:

Facebook - Privacy settings recommended by Sophos.

There are about five links in that article, to more specific suggestions for security, privacy, search, feeds, pokes, etc. Each setting is briefly described, with some suggestions about what you may be exposed to if you use other settings.

An easy read, and not at all "dictatorial" about what you must do; but of course I haven't actually tried getting to any of the settings, so you're on your own for now.

John