I totally agree with you. I will not post any photos of myself or my family online, except on a password protected site. I work in the criminal justice field, and I have become too aware of the "dark side" of human nature.
I have a professional contact who works with the FBI's "Safe Team" which, in conjunction with local law enforcement and local prosecutors, investigates and prosecutes internet crimes against children. He is a Detective, and is a computer forensic investigator. One of the things he does is give presentations to parents, children, and the public, making people aware of just how much information people can get about a person (especially a child) online and how easy it is to trace a path to one's door from the internet. Sorry to creep you out, but think how much information we all have about each other just from posting on this site--I know your kid's name and age, your marital status, I know what city you live in, that you live in an apartment, I know that you work out of the home and take the subway to work, etc., just from my casual reading on the weekly chat threads in this forum. (If I am remembering this correctly. Obviously, if I were an actual predator who was trying to figure out how to get at your kid, I would be paying closer attention and writing this stuff down!) How much more info is available on you (or me) on this site or the internet as a whole? A lot! If you had pics posted in your signature, I could identify you and your son by sight.
One thing that he points out, is that a person does not even need to contact you to get this information, so there could be someone out there checking out your or your kid, and you would not even be aware of it. It's creepy and scary, and it has happenned. Because of the nature of cyberspace, it's as dangerous as the "real world" and possibly more so, because people can hide behind false identities in a way they can't IRL.
I have a friend who has a personal website and a blog and she posts lots of photos of her kids. It bothers me because she has no control over who is viewing that. She and her husband's and kids' first and last names are all very easily accessible, as is the city that she lives in. What is there to stop anybody from calling directory assistance, getting her phone number ( which is listed) and putting it into Google or another site where you can do a reverse number lookup and get her address??!! In five minutes, a person can know exactly where she and her kids live.
Anyway, I'm writing a novel here, so I'll stop, but I just don't think it's paranoid to not want to post pictures of your kids on a public site--I think it's prudent. I'm very protective of my personal information, especially because the nature of my work and what I have learned in it.