So I should just send you all my DNS queries because you said so? Ur, I'd rather not, thanks.
This is common enough: http://www.ckollars.org/dns-intercepting.html
With some new, unknown service with unknown associations I can't reason much about the threat model.
Although your points about capability and motive are valid, I don't think that Google does feed DNS queries into a database. Given all the evil DNS servers out there, I think that it is in Google's best interest to provide a clean alternative and contribute to better internet infrastructure.