Well, to answer the question in the title, I think that etiquette evolves. Some rules become obsolete and new ones are created to keep up with how society, technology, etc changes.
So, I do think that there is etiquette that applies to FB. It's just not the same etiquette that applies to face to face conversations, phone calls, or anything else.
I don't think that there should be any requirement that people need to use FB consistently...in other words, choose a posting style and frequency and stick to it. Not only that, while the poster has control over who he wants to see his posts, the beauty of it is, that you also have a choice in whether or not you want to see it. And neither of you have to know what that choice is.
For me personally, I'm one that is infrequent in my posting style. Sometimes it's one or two a day and other times I go months without even looking at it. We're all different. And I'd be far less annoyed with someone posting pictures of a renovation (which to me is actually quite interesting), than I am about all those inspirational quotes (where do people even get those?), that some people post as often as 1 per minute (or 10 at once). Again, to each his/her own.
As for the public/private thing. I see it as inviting people into my house. It's not an open door policy where anyone/everyone can come as they please. I invite friends over. They either accept my invitation or not (and we each get to decide when they can leave). In my house, I'm a lot more free to say, display, and do things according to the way I want than I am when I'm at work, out shopping, or in someone else's house (or FB wall).