...FB has tons of different settings to choose from. I have a really boring life, so pretty sure no one is going to spy on me. I believe they use some of the info off your posts, etc. to target advertisements, but honestly, I've found some cool stuff that way!
Yes, the "friend" thing is very narcissistic. I get creeped out when someone I don't know tries to add me.
If you're really concerned with privacy, definitely read their privacy statement before signing up.