Fair point, although I suspect the counterargument centers around the reduction in participation in an opt-in system.
I wonder if something like a global "privacy" toggle could work -- a way to indicate what your own personal preferences for default behavior are. Apps would default sensitive features to the global toggle, while allowing specific overrides in either direction.
Of course the argument is reduction in participation... but that's fine. People should not be default-assumed to want to be stalked by Google. They should be prohibited from doing so, and be forced, like every other business, to seek informed interest in their product.
I think (s)he's right in pointing out that while location services as a whole has an initial prompt (I believe the default value is on, but you do have an opportunity to change it), the individual features in e.g. maps are default opt-in after install (and you have to navigate settings to turn them off).