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I think a GPS system, where it can pinpoint the limit to the area the car is in, would be a good move. Nobody needs 200mph in a school zone or city.
Give the cars a 10mp/h or km/h margin for error.
Tracks where people should be free to persue their own desires to go fast, would also fall under the GPS system and allow the already legal practise of going nuts on a private track.
If you're going to do it, by no means should it infringe on anyone's privacy. The system does it's job, and people go about their (slightly safer, hopefully) business.
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