/usr/local is the default location for user-installed stuff, but I personally like to have my package manager do its stuff in a separate directory. I like the way Fink [1] uses the /sw (software) directory. Does anyone have a valuable opinion on the comparison between Fink and Homebrew — or maybe MacPorts? [1] http://www.finkproject.org
I agree about staying out of /usr/local. I install stuff there -- I don't want my package manager taking it over. That's kept me away from Homebrew.
That was an early blocker for me as well; however, when I discovered that I could just install homebrew at ~/.homebrew, that made it all work out.
I created https://github.com/wilmoore/homebrew-home to automate this; however, you technically don't need this install script as you could do it yourself if you really wanted to. I like it because I no longer have to think about it.