It's not paranoid. Everyone knows they are watching these things and really why should you expect privacy if you have your settings set to open?
I think you have right to expect that a telephone conversation is private, and a conversation between two people in a car (although not in a restaurant), an email, but I have about 150 friends on FB. I know them all personally and all my settings are private, but I don't really feel have an expectation of privacy on FB.
To me it is like shouting across an open room to people I know. Anyone could be listening.