To create its Street View service, Google (Nasdaq: GOOG) sends fleets of cars to drive around cities all over the world and take pictures with the 360-degree cameras they have strapped to their roofs. The result is many things to many people: a convenient source of information, a depressing reminder that your home is ugly, an enduring memento of that time you ducked into an alley and thought nobody was looking, etc.

Even though Google’s cars stay on public roads, some also consider Street View a huge invasion of privacy. Before last week, those people might have thought they were being violated only photographically, but it turns out that devices inside some of those Google vehicles were spying on WiFi networks as well.

According to the New York Times, Google invited data protection expert Johannes Caspar to its German headquarters to check out the vehicles it uses for Street View. The service was already under the glare of European privacy advocates for its habit of staring at people’s houses, but Caspar pulled on a thread that eventually revealed something more troubling. Devices inside those Street View cars were actually sniffing unprotected WiFi networks in the neighborhoods they drove through and saving some of the information — what sites were visited, what was done there, etc. So far, Google has admitted that it happened in Germany and Ireland, but it was a mistake, they didn’t mean to do it, and whatever data was collected is being erased.

But Google’s already made something of a target of itself in Europe over privacy issues, and this development just threw another bucket of gasoline on the fire. Officials in Germany, Czech Republic, Italy and the UK are all probing the matter independently, and EU Justice Commissioner Viviane Reding gave Google her own personal stink-eye.

Stateside, privacy groups have asked the FTC whether it plans to do anything about this, so there may eventually be some action in the U.S., but there’s clearly a difference between the way American officials and European officials are reacting to this. Carl Howe at the Yankee Group told us, “The Europeans think we’re crazy for being so lax about privacy, and we see them as crazy because they get all upset over privacy issues.”

But how private is an open WiFi network, anyway? That’s debatable. Google didn’t go busting down any password barriers — not even weak ones. Logging into someone else’s unprotected WiFi without permission is a low and intrusive thing to do, but consider that these are wireless signals being broadcast into public space with no attempt made to block unauthorized users. Just because nobody should snoop doesn’t mean nobody will.

Encrypting your WiFi network is a lot like shutting your blinds. It’s up to you — but if you don’t do it, you’re relying on people to not be rude, voyeuristic and generally awful, which is a losing bet, so don’t be too shocked if you find out you’ve been gawked at. And once Google gawks at you, it’s not easy to be ungawked.