Online community researcher Danah Boyd has written a fascinating essay on Facebook's "Privacy Trainwreck". Even if you're not the Facebook type (I'm not either), I think her essay is worth ten minutes of your time.
Danah describes an understanding of privacy that is deeply subjective - more about "exposure, invasion, and drama" than about any objective, semi-permanent attribute. While I'm not sure her ideas work for all aspects of privacy (e.g., state surveillance), I'm not sure she's wrong, either.
A fascinating read, at the very least.