Given that Google was tapping into Facebook as if they were an Open Social partner, I can see why FB was quick to react.

In other news: who is completely underwhelmed by G's Friend Connect? Since when is MySpace the innovator?

Well, I've not checked out Friend Connect, so I can't comment on that, but as far as being the innovator, when you do enough stuff, it is highly unlikely you'll get is all right. Look at Google Video versus YouTube. I (and most everyone else it seems) ignored Google Video after trying it out for a little bit and just went to YouTube by default.