At least they are beginning to take privacy seriously!
Google+ may not be able to beat FB just yet, but at least they pose as a viable competition....
Win win for users!

Very true we have seen how Internet Explorer went about before Firefox became mainstream...
now with so many browser options.. each Browser Vendor are stepping up to make their browser unique and different, offering good developer tools, etc etc.

We can see the same pattern in the social space! Thing is that FB and G+ started off in two very different ways.. so both of them will kinda stick to their root as their innovate.. G+ will make everything related to circles, while FB will make evrything related to all your friends...

Hmmph, i dont think we can conclude it that way yet. G+ is still closing their platform to invites only...
plus it does not allow any business page on them yet, and the APIs are not open yet for applications to integrate them
Even if someone would like to migrate over to G+, they can't and don't find any reason to do so yet.
So long they stay Close, they are going to lose the hype over time, and people will end up sticking to FB and enjoy all the awesome features they integrate that they learnt from G+

It seems like with the new current interface..
I am assuming, In the privacy settings, you set the overall what you want your profile to show and who will be able to find you through search, email, etc..
With the new Friend List implementation, they would expect you to use that when you intend to share with only a specific group of people.
Otherwise no matter what sort of privacy u set, Friends will see it when set to Friends only, or everyone will see it (plus those who subscribe) if you share it to Everyone.