I don’t see where in the first quotation it says that the scanning takes place after iCloud upload. It just says monitoring.
I'm not 100% sure if this is about the on-device portion of this. Gmail and OneDrive already use this (and have for the better part of a decade) and I haven't seen any large outcry. Also, Apple has confirmed that turning off icloud photos means this doesn't work (this is separate from iCloud backups).