One reason is that it's not just your location that's the issue.

It's your location + all the other public information I can potentially find out about you combined with your location. The combination of a lot of separate facts can, together, potentially make people open to risks that aren't immediately obvious.

For example consider what location from foursquare + sexual orientation from facebook + photo from twitter would give to the scum who gay bash. The combination of religion + location + face is another thing some folk wouldn't want to be public.

I hate to think what the National Front would have done with a "gays, muslims & jews near me" app...