I've had an iPhone since the 3G's came out. I don't see what the big deal is here. Sure I don't like it, but I mean really, what are they gonna do? Sell it to the govt for them to.... what? Find out where your favorite donut shop is? The govt already knows your address and social, but black helos don't follow you around all day. Its Apple... they're probably not looking at a specific phone's data but a large map with a collection of points, to see where to focus their marketing.
As for hacking it, with all the "secure" apps are available to store passwords and other important stuff, your location is probably the last thing a hacker is interested in.