"The fact that anyone can grab that information from your iPhone with a simple download seems like a massive oversight on Apple's part."
In this case, "anyone" means "anyone with physical access to your computer or cellphone."
I don't know about you, but in the event that unauthorized individuals have unfettered physical access to my computer or cellphone for any length of time, about the least incriminating thing they'd be able to come up with is a heatmap of a set of points near where I've been. This isn't even GPS data, it's cell triangulation only. Zoomed in closely enough, and what the map shows is an evenly spaced grid on a map, showing places somewhat near places I've been, but nearly all in places I've never actually been, and several places I couldn't possibly have been.
Yes-- mobile devices are becoming more widespread, interconnectivity is becoming more pervasive, and networks are becoming more and more location-aware. There are certainly legitimate privacy concerns to raise in connection with this trend, as this article illustrates.
Does that mean every headline has to be written like a Watergate-era expose where the sky is falling because Steve Jobs' "plumbers" are coming to fix you by doing Something Bad? with Your Private Data??
Yes, I'm sure some people don't want this information recorded-- anywhere. It'd probably be a pretty good idea to lobby Apple to at least put in a preference for this. On the other hand, lots of people put multiple applications on to their phone to duplicate or enhance exactly this functionality. I can certainly imagine legitimate uses for having this data on the phone even in cases where a user might not necessarily have opted to have the feature turned on in advance-- such as figuring out where the phone has been at certain times if it is temporarily missing-- stolen, sold, then recovered, for instance.