as far as i know, Loopt doesn't stalk you unless you press "update", as in it wont tell your friends or as we say on facebook: put an update item on your mini-feed. so just press home and loopt no longer does anything until the next time you open up the app, go to "what's up" and press update.
When someone pings you, you get text message letting you know. If you get pinged all day it can be quite a few text messages. So far I think the most I've gotten in a day is 25.
And as far as having to hit update for someone to locate you. I think yes for the most part. But a friend of mine stopped by tonight and we both just ran Loopt without updating and it showed us both within a block of each other. Before he dropped by, he was about 6 miles away. So, if you REALLY don't want someone to know where you are at, limit who you update to, or "hide from everybody".