"You can't hide your friends from your friends and applications. Unchecking that box will hide your friends list when a non-Facebook friend views your public profile, but it will not hide your Facebook friends list from your friends when they look at your profile. Also, this information will be available to applications and application developers."
In case you have any doubts about your Facebook friends lists being publicly available, this hack will dispel them right away. One URL will reveal all the friends of any Facebook user. You don't even have to be logged in to use it.
"Certain categories of information such as your name, profile photo, list of friends and pages you are a fan of, gender, geographic region, and networks you belong to are considered publicly available to everyone, including Facebook-enhanced applications, and therefore do not have privacy settings. You can, however, limit the ability of others to find this information through search using your search privacy settings."
"Publicly available information includes your name, profile picture, gender, current city, networks, friend list, and Pages. "
Another set of horror stories about what can happen if you don't pay attention to your Facebook privacy settings.
I use Facebook every day now. I'm pretty well hooked. But this article, which talks about the intellectual pedigree (Girard), political sympathies ("Thatcherite") and financial connections (the CIA) of its board, gives me the creeps in a big way.
Security researchers at CA have found that Facebook is now collecting information about your activities on partner sites regardless -- this is important -- [i]regardless[/i] of whether you have opted out or [i]even whether you are logged in to Facebook[/i