It's likely a lot less about giving Google's first-party apps privileged access than it is a super low priority for the team to allocate engineering effort to.
I was a PM in Google Workspace for several years. It's a lot less nefarious than it probably seems. Decisions are optimized for revenue and other features (especially for enterprise customers) are going to be much higher priority.
Companies choosing to focus on enterprise revenue (which is basically all of them since like 2012) do so at the cost of end-user satisfaction.
I believe it. Most people would be better served paying a local company $20/mo to offer the equivalent of google services using open protocols. Unfortunately such a marketplace doesn't exist, but I believe it will eventually.
They removed the permission for nextcloud, that seems they actually spend resources on removing the permissions. The minimal "spend no resources" approach would have left nextcloud with access.
If it looked as nefarious as it is on the inside they would have roughly zero employees.
I don't doubt what you're saying, but whatever the reason, the end result is the same: Google Apps have a "first-party apps privileged access".