There's a difference between upsetting a few vocal users to improve the service and making the service worse overall simply in order to model the real world more accurately.
The real world has 6 billion users. It works really well.
Many people have noted that explicitly declaring who your friends are in Facebook is really quite awkward when applied beyond your, yah konw, friends. Coworkers, for example, make this really awkward.
So my point isn't that they should reflect the real world arbitrarily. My point is that they should do it because it is better.
You think it's better...because it would decrease awkwardness? I'm not sure I follow. Maybe I'm misunderstanding you...but I think it would increase awkwardness.