So after doing a quick analysis of the data on my iPhone, I've come to the conclusion that this isn't a huge issue at all.
First, I'll start with the WiFi data (WifiLocation table):
Among the information captured is MAC, Timestamp, and Lat/Long. I have a total of 118,640 records in my table. I did a "SELECT DISTINCT MAC FROM WifiLocation", and got... 118,640 records. This tells me that it's not "tracking my every move" via Wifi location since there's a single entry for each MAC. The question might be, is it updating the Timestamp when I'm near a specific Wifi Network? My guess is no. I did the backup and analysis this morning, April 20th. Yet the last entries in my database are from April 16th. This tells me that it's not an always on tracker and that it's not updating timestamps.
Next, I looked at the CallLocation table:
The same thing held true with this table. The last entry on my phone was from April 16th. Also, I have 6300 entries in my CellLocation table. I decided to start restricting the precision of the Lat/Long to see if there were duplicates that would indicate "tracking". At 5 decimal points, there were no duplicates. At 4 decimals, there were a handful that had 2 dups. At 3 decimals, there were more dups, with the most being 6. At this point I still had 5672 uniques. At 2 decimals, the most had 89 and I had 2468 uniques. At 1 it really went down, obviously, and I was down to 253 uniques. The other thing I noticed was that there was no regular timing of entries, and that when there were entries, a large number of them had the same timestamp.
So based on my analysis, this isn't a feature that enables detailed tracking of a user. It will allow you to see if a user has been in a certain location the first time, but that's the extent of it. For instance, I could see that I made a trip to Washington DC in late October of last year. But you can't really tell my movements around my home town with any amount of precision. My assumption, like others, is that Apple is using this to enable easier use of Location based services. I assume (which I'm going to test), that whenever a user enables a Location Based app (Google Maps, FourSquare), iOS updates this database with all local cell towers/wifi locations and the Latitude/Longitude. The more comprehensive the local database is, the quicker/easier it is for Location Based Services to help pinpoint a users location. Instead of waiting for GPS to spin up and get a satellite lock, it will be able to get a more accurate lock off of cell tower/wifi triangulation.