This is not to protect you, it's to protect the website.
>The service provider can still decode the info by MitM'ing.
Yes, but as I explicitly mentioned, only if you visit the website. If NSA goes to the website and demands the data, they can't do anything with it until I visit, whereas if it was decrypted, they could. This is a non-trivial difference.
>If you are using Google Fiber, for example, your service provider can do whatever they want anyway – they control your browser, they are a CA and they are your ISP.
Google is not going to risk their entire reputation by abusing their CA. Notice how CNNIC was removed from trusted stores and basically lost their business. Mitm by compromising a CA is far from trivial. Also, certificate pinning can mitigate the CA risk almost completely.