It’s worth noting that I had to retire a few devices that I used with my iCloud before I could enable ADP because they didn’t support it. That may be why it’s opt in, although it’s not a very good reason.
The other reason may be because Apple can’t recover your passcode if you turn on ADP and they don’t want customer support nightmares of users losing access to all their precious photos and memories because they could be bothered to manually back them up or remember their passcode
It collects and stores information about your system and also has your identity tied to your purchases.
I don’t think it’s a big privacy concern as far as tracking and spying on you.
But realize any device you install steam on then is tied to your real identity if you purchased games on that account. And can be used with data gained from other parties to determine your online activity if a government were to be able to obtain both.