I don't get why they would put a toggle in the upper-right to do this.

They already have search categories in the top-left. In their screenshots, they're on the "Web" tab. Why not just add a new tab representing generic search, make that the default, and leave the web search as it is today?

Making the "Web search" also search your personal data, then giving you an option to make the "Web search" do a non-personalized search just seems backwards to me.