I understand your frustration but I have my status turned off by turning off the entire chat functionality. I dunno how it's snitching on anyone really except that if you have opted in for it to show that you're online it will, which is pretty common practice of any social networking software, chat software and such, like Skype etc.

Dont' get me wrong, I'm no big fan of fb but I have to say if you think that you're missing out on something if you're not on fb you are very wrong. The only thing fb does for me is let me see artists that I like and game posts and such because that is all I use it for. I don't use it to keep in touch with friends, I don't want to see people's lives and play by play of their days. I just don't follow them so I don't se it and only friends that I allow see my status updates because I never post to public either. It's still pretty non-private so I don't expect that but you have some control over it.

The problem here with your "stalker" friends is that they are, as you imply, annoying and stalkerish. It's not really the site's fault but how people do that to you that is. Simple thing. block the people you don't want to see when you're online, opt out of having your status show by turning off the chat messaging software or filtering it so only the people you want to know can see it.