This is hardly city driving. Try driving in a European city. (I love this project and can't wait to buy or rent a self-driving car)
I think self-driving cars will be introduced very gradually. First only highways where it's really easy for a computer, then maybe American cities. The harder the street layout, the longer we'll have to wait for this technology. So maybe American cities will get the technology a few years before European.
Auto-drive on long highway sections would be an amazing improvement by itself and prevent all kinds of fatigue related accidents. The cars could just announce ("Driver, take control") as they exit the highway system.
Hell, trucking companies could just have drivers waiting at highway exits to do the last-mile driving, the long-haul sections of trucking wouldn't require a person on-board.
I don't think it would be unfeasible to install beacons designed to aid driverless vehicles either, especially on highways where things don't change very quickly. Simple posts with machine-readable signalling (visual/radio/whatever). Most signage is designed for human recognition, but I bet it wouldn't be impossible/terribly expensive to install signage designed for automated driving.