I'm not at all surprised that a lot of people trust Google, not only when it comes to their daily activities, but they would also entrust their crypto assets to them for safekeeping.
Even if you naively believe Google are a completely benevolent company and dont exist for the sole purpose of harvesting your data and making profit from selling that data, do you also believe the same about every single one of their employees? What about every employee of every third party that they farm out their services to, or works for them, or provides their services, or hosts their servers, or repairs their hardware, and so on. There is a huge list of unknown people whom you need to trust when you start storing anything with third parties. It's a very risky position to be in.
It is nonsense to say the least, but I would say "your money, your risk", so let everyone decide what they want to do - some keep their crypto backups in Gmail anyway.
Sure, but that risk needs to be informed. Many people incorrectly believe Google is completely safe and impervious to hacks, leaks, bugs, or vulnerabilities, and so may choose to store their seed phrase in their email or something similar because they wrongly think it is safe. If you are aware of how risky it is and choose to do it anyway, well, that's a different story.