Only place that asked for ours was in Turkey, and they gave it back within a few minutes....but I guess Turkey is not Europe. (maybe they will be in the years to come)

It's mainly Italy as far as I know (never been to Russia). And yes, I feel totally comfortable and would never hang around waiting for it back any more than I'd stand guard over my luggage in the hotel room 24/7.

ours was kept for a few hours in 4 of the 5 cities in italy we were at. in greve we were at a private apartment and they could have cared less.

Not in a hotel, but at the Vatican Museum for the audio tour, you must leave a photo ID...I had my Drivers License from the US, so I left that...
I did notice that some people were concerned as all they had with them was their passport, and this requirement for leaving a photo ID was strictly enforced to ensure the return of the audio...

We did not encounter this policy on any other audio tours on our trip..

W found taht every hotel in Italy requests to keep your passport to copy information for a form they need to fill out for their government. We avoid the situation of giving up your passport by having a colored copy of the page with your picture etc. and giving that to the desk clerk. They always accept this b/c it has all the info they need. This is then returned to us and we still hold onto our own passport.

All our hotels in Italy and Croatia have done it. Never in UK, France, Spain.

In Italy, as a temporary visitor you are required by law to register your presence with the local police station. The people at the hotel are performing a service for you--they register you so you don't have to go to the police station yourself and register.

Per Jed's 'shredding the constitution' statement, all Italians are required to carry valid ID at all times, and present it if requested. Years ago an American friend of mine was teaching English in Italy. Her high-school students were scandalized when she stated that in the US we are not required to carry ID.

"What do you do when the police stop and ask you for ID?" they exclaimed.

When she replied that the police couldn't do that, they seemed even more confused and scandalized that somehow this was unsafe and illogical.

Different cultures, different customs.