I have Drupal 7.9 installed with Facebook for Drupal module version 7.x-3.x dev.
Here are the errors given after turning on FB API & FBCONNECT:
Warning: include(/src/facebook.php) [function.include]: failed to open stream: No such file or directory in fb_requirements() (line 66 of C:\xampp\htdocs\drupal\phswap\sites\all\modules\fb\fb.install).
Warning: include() [function.include]: Failed opening '/src/facebook.php' for inclusion (include_path='.;C:\xampp\php\PEAR') in fb_requirements() (line 66 of C:\xampp\htdocs\drupal\phswap\sites\all\modules\fb\fb.install).
reverting to a 6.x install for functionality is not an option. I hope someone can help.