It's hard to apply this advice in a consistent, rational manner, but just because someone else is doing something doesn't mean you can't do it differently. You're much better off assuming that several other people are doing it, and figuring out how you're going to succeed in that kind of world, rather than in one where you're winning the market all by yourself. Conversely, you need to watch out for mature market players. Although you don't want to advertise your idea everywhere, the gulf between having a good idea and executing it successfully is so enormous that disclosing the idea really doesn't amount to much. Don't be too afraid about letting potential investors evaluate your business plan.
Chances are they've heard it before anyway.
Trust me, there aren't any business ideas that only YOU have thought of. Secondly, VCs are wary of people who are overly protective of their ideas. Don't invent a need to justify your product. And be honest about this. It's amazing how deluded people can become in describing how necessary they think their product or service is.