That being said, just disable the unlock with smart cover and problem solved.
An insecure default shouldn't be excused because you can change it - the default configuration should be secure against such an attack.
So in order to avoid this bug you would have to own a smartcover (or magnet) and hold it up to the sensor (it’s on the right side of the device) in order to display the option in the settings and only then could you turn it off.
1. What bigger problems do I have to worry about?
2. The iPad uses encryption just like the iPhone. Most people won't be able to defeat that encryption, but most people will be able to do this simple on/off hack.
Sure, but the decryption keys are also on the iDevice, otherwise it wouldn't work. Which means that a competent cracker can get access to your data. Not a big issue if all you have is personal stuff (but then, how bad is it if your personal data is compromised), but the gains for bug business espionage could justify the expense of a crack... So yes, the battle is already lost if an attacker physically has your iDevice in their hands. Don't do that.
Still, the default setting for the smart cover is clearly a bad security error by Apple - I trust it will be quickly fixed.
> The attacker has physical access to your device ... you have bigger problems to worry about.
I don't have bigger problems to worry about (or maybe I do - what are they?)
Perhaps 1% of thieves can get at my encrypted data, but probably all of them will be able to perform the few steps necessary to bypass the lock screen.
Uh, no I didn't ;)
Look, the thing is, if you're worried about a casual thief, they probably don't care about your data anyway, they're going to wipe the device clean and resell it. If it is someone that actually stole the device to get the data, then I would expect your '1%' (plucked out of the air, or is there a reference for this kind of statistic - honest question, I'm not snarking) is actually going to be a much higher number, in which case the encryption isn't going to save you. It's pretty much game over once the attacker has their hands on the physical device, afterwards it's just a question of time.
Most theft is going to be opportunist. For most thefts my data is going to be protected by the encryption. So in most cases, I don't have anything bigger to worry about.
A more sensible way to encrypt a device is to use a separate long code that only has to be typed in at boot. Using a screen lock as an encryption key is just not effective.
Previously, physical access meant someone broke in or fraudulently gained entry to a room where your pc/server lives. Nowadays it means someone grabbed your tablet/smartphone for a minute while you are in the bathroom.
Your e-mail is the key to your entire online (offline too?) identity.
I trust my friends but I wouldn't give all of them "me-level" access to my entire life.