Which are surely, totally not ingesting every iota of data they can get their hands on (legally or not, including your prompts) for training and the soon-to-be born “embedded ads”.

They're free because they're either gathering more data or trying to capture the market.

and who is funding them? how are they paying for their servers? a product can't be free, someone somewhere is paying for it. the main question is why are they paying for it.

No such thing as a free lunch.