This whole argument is VERY interesting. I think that the reasons it has ignited such fierce resistance offers a very telling insight into our current social state-of-mind. Let's just look at a few facts:
1. We have CCTV everywhere these days. Many people are fed up with it and don't like it. It's possible we see Google Streetview as an unwelcome extension of our CCTV-controlled environments.
2. We live in a rather dubious "database state" where our privacy has become something of a joke. The government holds so many databases on us (when they're not losing them on trains or getting their laptops nicked), not to mention TV licencing, DVLA, banks, NHS, etc etc etc. It could be seen as the very streets we live in are now getting stuffed onto databases which could make people feel somehow overpowered.
3. We live in an era where threat assessment levels are higher than normal thanks to Islamic terrorism, and these Google images can give an unsettling impression that terrorists (and indeed other criminals) can use the "virtual spaces" to plan various attacks. Whether there is any factual truth in this is debatable but it can at least cause that impression.
I remember there was a flutter of suspicion when Google's satellite images zoomed in so close that we could all visit Google Earth and see the roofs of our homes. We seem to have adjusted to this quite well, but then again what harm is there in seeing your roof? Streetview is perhaps too close for comfort, mingling among us in our everyday lives in a way that goes far beyond CCTV. Google's 3D camera has been received as an invasion.
Privacy International have made an official complaint and want the service closed down.
Source:
http://news.bbc.co.uk/1/hi/technology/7959362.stm
My own thinking is that it's a great idea but it has been poorly introduced to an unsuspecting public. It's probably a bit ahead of its time and plagued with infancy teething problems but I'll bet this concept will be a grower!