Security and downloading from market.

I am new to downloading for a phone and it gives me warnings of what can be accessed if I do download an application.

Some say for example:
This application has access to the following -
'system tools' -prevent phone from sleeping, change wifi state
'network communication' - full internet access
'your location' - coarse location, fine location
'phone calls' - read phone state and identity.

So far I haven't found the answers in the manual! Am I being over cautious?!
Cheers
Sim

Many thanks for that. What about the 'prevents phone from sleeping'?? Any ideas?

Cheers
Sim

Really appreciated, many thanks!