(OP) You make great points. I think we're actually more in agreement than might be obvious. Part of the reason you need to "give" data to an LLM is because of the way LLMs are constructed... which creates the privacy risk.
The principle of attribution-based control suggested in this article would break that principle, enabling each data owner to control which AI predictions they make more intelligent (as opposed to only controlling which IA models they help train).
So to your point... this is a very rigorous privacy protection. Another way to TLDR the article is "if we get really good at privacy... there's a LOT more data out there... so let's start really caring about privacy"
Anyway... I agree with everything in your comment. Just thought I'd drop by and try to lend clarity to how the article agrees with you (sounds like there's room for improvement on how to describe attribution-based control though).