I think part of being a good system administrator is knowing about how far your solutions can be pushed. It's Google; it's not surprising that they want to be sure that you don't reflexively do things that will break at scale.
After discovering rsync wouldn't work I would have just said "I don't know, I've never worked at that scale," and reframed the conversation from one where I'm trying to guess the right answer to a conversation with more give-and-take.