privacy != security.
And sandboxed Google Play services serve both goals -- it runs the service as a regular android service, not an exceptional one that has a bunch of extra permissions. So you can allow/restrict it as you seem fit, while not "getting behind" on features/apps that mandate it.
I disagree, privacy is an essential part of security, if there's no privacy, then there's no security.
That's also why I don't keep anything important on my phone as I don't trust what's going on there despite having all the secure features that you would want.