I can see the problem with this implementation though. It's not terribly difficult but so far none of the security checks take in to consideration other users. Public is available to anyone who wants to view it; even if they don't have a Deckbox account. Password protected is like public but requires a password; it does NOT require a Deckbox account.
Adding the option of "Friends" to the privacy settings would be misleading, in a way, because what if you wanted to share the deck with someone who didn't have a Deckbox account. You would be left with the choice of exposing the deck to the world (public) or telling your friend they HAVE to make an account which they may not want to do.
One solution would be to modify the privacy menu to allow certain options to be mutually exclusive (i.e. Public and Private) but allow others (i.e. Password Protected and "Friends") to behave more like groups where-in you can select one, the other or both. Simply put, checkboxes instead of radio buttons.