For an excellent, rational and helpful discussion of one’s rights when using a camera in public places, go to The Strobist blog. He is a working professional photographer with excellent creds, intelligent comments and great technical ability (in case you want to learn about using small strobes).
In this post, he discusses a personal incident and elaborates on what he does today to try to defuse a situation before it develops. Completely sane person with no axes to grind.
Plus he links to a document on photographer’s rights which I personally have printed out and carry copies of in all my gear bags. One for me and one for any law enforcement officer who may be sent to check me out while I am shooting in a public place.