While corruption and error are certainly major factors in privacy, there are some things that are just private. I don't want people, even people I know and trust completely, to know about the details of my sex life. Not because my sex life is crazy and deviant, because it is private. I don't want to have clear bathroom stalls, not because I'm doing something wrong or worry about someone harming me, but because it is private. Voyeurism is an invasion of privacy, it doesn't hurt people in any other way, but it is illegal, and should be.
In short, privacy is import because of the instinct you mention. The desire for privacy is the reason for privacy. Privacy is like freedom, it is a basic human desire and requires justifications to violate or remove, not to support.