This is an entirely UX problem then. You could bury the data faking deep in the settings, clearly explain what it does in plain language before enabling it as well as plainly telling the user onscreen that the application is being fed information for privacy reasons that they themselves enabled (and can easily disable).
There is always someone who will end up enabling this erroneously, but it would provide a lot of value to a lot of users that didn't.
Right, locking the functionality off to only people with a deep understanding of it would work but it’s sidestepping the problem. People without understanding would still benefit from it so it’s a shame to lock them out of it and it’s harder to justify a feature only 0.5% of your user base will use.
It's impossible for the OS to know the intent of the app requesting location with certainty. That being said, android at least has options for "Approximate" and "Precise" locations and locations in the background or only when the app is open.
Personally, I think it’s great that both options exist. Some problems really do require location info, as well as other strict controls ( like no screen-shots).
There's truth to that, but jailbreaks to install those on most smartphones depend on exploits for those systems to install your own software. It would be nice if some of this stuff came stock.
There is always someone who will end up enabling this erroneously, but it would provide a lot of value to a lot of users that didn't.