Google has what I think is the most transparent and user friendly controls for visualizing what personal data is collected, and disabling it (most often per product, for ex. disable location history and YouTube viewing history, but enable personalized ads).
I don't think this stops Google from collecting your viewing history. If it did, Youtube recommendations wouldn't work at all, because they would know nothing about what I like or don't like. But I'm pretty sure recommendations work regardless of your settings -- meaning you're being tracked.
I happen to like the recommendations, so I don't mind this. But it's a hard problem.