Agreed the whole "peeping tom" issue with drones is a concern. But the FAA isn't worried about that. They've actually stated quite clearly that homeowners don't own the airspace above their land. I handle it by keeping my clothes on outside and not storing images online of myself that I would object to others seeing. It works pretty well.
The FAA's real concern is going to be safety for full scale pilots. That is how it should be. A distant second will be safety for everything else that could be caused by drone crashes. I know lots of people have been critical of the AMA's lobbying and negotiating efforts on this, but I'm actually pretty impressed. We aren't likely to see any significant limits to what we can do in the long run. Even the 400 foot altitude limit will likely relax for fields away from airports as the AMA makes a convincing case that we aren't a threat. I do think there will be a crackdown on flying near airports, as there should be.