Yes, actually anyone can hide their friends list from anyone. If you go to your profile and click on the little pen icon next to your friends list on the left side, there is option change visibility settings.
On another note, FB actually has some pretty advanced privacy settings, there are two problems. First, the settings are not obvious and intuitive to all users. Second, it really takes some time and effort on the users part to get the settings just right. One way to do this is to put your friends into what FB calls "Lists". For example, I have several different lists, one for friends I really trust, one for work colleagues, one for relatives. Once you have all your friends separated into lists you can change your privacy settings and many other options based on those various lists. So for example, my relatives can see certain photo albums that my work colleagues can't see, and I have college friends who can see albums that my relatives and work colleagues can't see. You can also limit what they can post on your wall (if anything), what info they can see about you, and many other options. FB's biggest problem is that they assume everything should be open to everyone and then make it extremely difficult to back off those settings.
On another note, FB actually has some pretty advanced privacy settings, there are two problems. First, the settings are not obvious and intuitive to all users. Second, it really takes some time and effort on the users part to get the settings just right. One way to do this is to put your friends into what FB calls "Lists". For example, I have several different lists, one for friends I really trust, one for work colleagues, one for relatives. Once you have all your friends separated into lists you can change your privacy settings and many other options based on those various lists. So for example, my relatives can see certain photo albums that my work colleagues can't see, and I have college friends who can see albums that my relatives and work colleagues can't see. You can also limit what they can post on your wall (if anything), what info they can see about you, and many other options. FB's biggest problem is that they assume everything should be open to everyone and then make it extremely difficult to back off those settings.