Sure. But this doesn't have to be an either/or choice.
It's possible to make it easy for those willing to surrender all privacy and control without making it impossible for those who don't.
Example: Amcrest cameras are just fine with being restricted to the local network. If you ask nicely and order direct, they'll even give you a discount.
My vision of how this should work can be inferred from https://github.com/atomirex/umbrella Essentially in the future wherever we have WiFi APs those should also be media SFUs (and probably MQTT brokers or similar) where each client will only see the AP and things the applications running on the AP have explicitly allowed, including streams piped opaquely from anywhere else.
The idea that being connected to WiFi means ability to see other devices and the public internet needs to stop being the default.
Right now domestic IoT and Home Assistant are like Windows Mobile and Symbian prior to the iPhone: proof that something interesting and useful is possible in the domain, but requiring an enthusiast level of investment in knowledge and time to maintain and operate.
Were I a billionaire I would be attempting to launch the Android (in the original intended sense) of IoT to solve that.
One might hope this to be the case, but there are mountains of evidence to the contrary.
>I'm not saying they are too stupid to figure out how
Never fear. I'm here to say it so that you don't have to. Most are too stupid.