Teddy,
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Yes, I can imagine problems in New York or any built up area for that matter. I do use a bit of common sense. For example that light house. I made like 3 trips there before I felt comfortable in shooting just because of excessive people. I also don't flaunt it....sort of start out of the way a bit, don't make a scene (no pun intended lo), launch, go high, come down lower somewhere else. So, I can't imagine, thought I'd want to, lifting off in times square.
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I live in a small rural area. That said, I don't want to purposely test the law by launching right in front of a trooper or anything. :) So, I keep a low profile - pun intended. ha.
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But check this guy out. He does tutorials and stuff but geez, he flies over everything you can imagine! Just pluck through the timeline of this video a little and you will see what I mean. Over beaches, people, pools, etc.
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Eric