Now that Steve Jobs and co. have spoken on the location tracking controversy, we now know that it was merely a cache of recently (okay, maybe not so recently) connected WiFi nets and cell towers in order to speed location finding. This revelation means that nothing bad was intended, but the worst was assumed (and rightly so – no harm in being paranoid. 😎
As I predicted, Apple will make a patch that will reduce the file contents. It will even remove the file when Location Services are turned off.