Yes, you are very correct. By letting people into your home network, you are allowing them to see all your data. If multiple machines are sharing the connection, they are all peers on the network and outsiders can see them, depending on how their individual security is set up. That means that your neighbor can browse your machine for your financial records or anything else.
I cannot agree that stealing network access is a good thing. Hotspots are set up all over the place, many of them free, so that's fine. Starbucks wanted to make it easy for people to spend more time sitting in there and drinking coffee. But logging into your neighbor's network is illegal because of the terms of the cable or phone companies' agreements.
Encrypting your router is easy and will prevent access.