Would it be reasonable for a restaurant to know about every other restaurant you visit? And every store you look at, and every newspaper article you read?
Of course in any case Google knows and they choose how much they want to tell you.
Nevertheless, I don't feel iffy about my Interests profile participating in aggregate data available to the sites I visit. Since virtually all sites are free of charge, giving some of that insight back seems like a fair trade.
That said, having ALL that data available to Google without anonymization is a bit more worrying, although I haven't seen many examples where it hurt someone in real world.