I've put together this module to extend Drupal's functionality giving a truly private file system. Currently, Drupal will let you choose to store your uploaded files using the public or private file system however, even if you chose private it is still possible to browse to these files with a URL. I've come across a few situations where I've had files which should only be viewable by logged in users (e.g. user pics). In other situations I've needed to make sure certain files are only viewable by the user that uploaded them.
Private Files Module lets you do all this without breaking a sweat.
Let me know what you think.