Re: This is VERY questionable
I'm pretty sure there weren't in Android 2.2 or 2.3 (which are the last versions I used). Although it's 6 months since I jumped ship from Anrdroid, so I'm perfectly happy to be proved wrong.
You could turn location tracking off, but then you lost access to aGPS. Or you could have tracking on, but the Sat Nav chip off, which in some ways is better than the options iOS or WinPho 7 give you. You also get told some of the things that apps can do, on a take it or leave it basis when you download, which is better than iOS as well. But I don't recall seeing any options for turning off Ad networks, app-use tracking and all that type of stuff. And I went through every setting on the phone.
However, when you say you can root the phone if you're paranoid - that's not terribly helpful. If I'm paranoid, taking untrusted software off the internet, and giving it root, well that doesn't sound too good to me! OK, it's used by a lot of people, but a lot of the ROMs seem to be one-man projects, so the chances of them getting caught slipping in something naughty, seem quite low. Android gives you a wealth of choices, but you need to do a lot of work to protect yourself, and half the time you've not got the information needed to do it.
Backdoors seem to be the norm on all the modern smartphone OSes, most of the manufacturers are only putting out closed-source drivers, and everyone from Google to app makers seems determined to mine the maximum amount of information they can get away with, with the minimum amount of permissions. I don't see this changing any time soon, without legislation. The commercial disadvantages of offering proper privacy are quite large, so once everyone else is doing it, it's hard not to join them.