Wow, just watched the TEDx talk from Cory Doctorow on children and online privacy:
bit.ly/fGPpHw
Some ideas I hadn't heard before and I think I agree with a lot of them...
My starting point for my sons (13 and 9 yo) is that anything they write anywhere - emails, texts, facebook, even print - will be public. There is no privacy.
The eldest in on FB btw with very tight controls which I set up, so it's not that I've given up, it's that I don't want him to feel that those are secure. Because they're not!
I'm sure one reason I like this is that it gives them a way to be private from snooping. But it doesn't really address the worry of accidental release of information from trusted sources (eg a friend forwards an email to someone who forwards it on to two people, etc).