There is another aspect as we go to more and more realistic worlds. In Google Maps I can ask to blur my house. As we go to more and more detailed worlds, can I ask Sony to blur my home too?
If the geometry is sourced from a service like google maps, it would probably be blurred. AFAIK, anything blurred in Bing maps is also blurred in Flight Simulator.
Did Google Earth get permission for all those buildings?