I don’t see China’s relevance here: they have two choices: play by their rules or leave on the table shitloads of money. Maybe not morally the best decision, but it is not black-and-white evil I would say. For a Chinese person that also has to play by the same rules it is an added choice, and since all are similarly hijacked by the government this aspect doesn’t make it any worse.
Also, CP scanning was deliberately proposed as a way to actually enable e2e icloud - but they just didn’t want to be liable, as storing CP encrypted on their servers may also be problematic. So, I don’t see them malicious against privacy at all, in fact that is a core selling point of theirs, it would hurt them greatly to cheapen it out.