Can you add privacy option settings on newsfeed for user before posting? eg. on the What's happening? status, I type Hi and then a drop down menu to select who can view, everyone, me, friends, custom groups, similar to facebook posting status line. I hope you can add this privacy option to newsfeed.
Maybe you can also create another plugin for "create custom groups for privacy" sitewide?
Please make a suggestion on uservoice: http://oxwall.uservoice.com/forums/13756-ideas-for-oxwall if it gets enough voices, we'll consider implementing it.
In the meantime this is a custom code modification. You will need to do that on your own, if you're good at programming or hire a programmer to do that for you. You can do that here: http://www.oxwall.org/market/specialists
Also, you can make a post in the Custom code modification section. Probably some community member will assist you there