The ruling for the frightful presence monster ability states that it is activated as a free action as a part of an attack or charge:
This special quality makes a creature’s very presence unsettling to foes. Activating this ability is a free action that is usually part of an attack or charge.
However, I keep seeing the groups in my games have the area of the frightful presence as just something that is always active. If there some ruling that makes the presence always up that I don't know about?
Activating this ability is a free action that is usually part of an attack or charge.
The word "usually" is important here. As a free action it's not unreasonable to assume they walk around with it active all day (so it functions as a passive), but you don't have to do this.
The disadvantage to having it "always on" (aside from the social isolation) is that an enemy who succeeds at their save is immune for 24 hours. This means that if you pass near them 3 times during the day before combat begins you've given them 3 chances to pass their save and be immune to the power. Activating it as part of a charge means that you're saving it for the moment when you need it.
The actual answer to your question though is "yes it can be always on".