Sure, you _can_ be more secure by using these services, but you aren't more secure simply by using them.
a root level compromise on your system can see any of this stuff in plaintext as it gets shifted around.
Sure, but that was true without cloud storage, too. Worse: Without cloud storage, a root level compromise lets the attacker destroy your only copy.
However, this does not refute the argument that, with the cloud, the attacker can get at your data two places, instead of just one, thereby increasing the attack surface. (In fact, the attacker can get at it three places: in transit.)
(Ah, that is, you have to believe that the encryption used in all legs of transit is hard enough to break.)
The problem is if your local machine is compromised, then the attacker can delete you local files. These deletions are then synced to the cloud storage.
The same can happen if you get ransomware encrypting your local storage, the encrypted changes get synced to the cloud.