Because you'd scream your head off like other HNers when a news article "100 million users private photos uploaded to Facebook and Genshin Impact!!!!" appears and would demand Google policing.
You can keep all your functionality, Nextcloud just needs to migrate to an API that gives YOU AS A USER control over what it can read instead of demanding blanket permission for everything.
I promise you I would not. I do not want my technology baby-sat by a third party, I want my technology to do exactly what I want.
I also promise I wouldn't run a game or anything that demanded full access to everything that made no sense to have that permission, because what the heck? Outlook wanted "Device administrator" permission on my personal phone when I wanted to connect my office email to it. I politely declined, and stopped using it. (I mean, I understand WHY Outlook needs that, for secure wipe of data, but that's a pretty wide permission for that one reason)
I cringe as I watch one of my kids authorize elevated permissions when they launch Genshin. (For the anti-cheat) And I promise them I will never run it on my machines :-/
But rather than get lost in the details, what I REALLY want, is a piece of software that will backup and restore the entire contents of the phone to a server of my choice, preferably self-hosted. Right now, this "full system access" option gets the job done, but it's a thermonuclear footgun for the unsuspecting.
How could we convince google to create a new a "Full backup of the device" permission? Because then Google could simply deny the permission labeled "full backup" to the latest hot new gacha game, while allowing legit backup apps the power they need?