I don't have a problem with websites measuring what I view, click, add to cart or buy. I want them to be able to see what doesn't work in terms of user experience.
And if they do marketing I even want them to be able to see from which source of traffic (aka marketing effort) how many conversions (whatever comprises a conversion) stems.
The problem imho isn't GTM (Google Tagmanager) running as proxy. This would (or at least could) be a data privacy win if done ethically. At least under one imho essential condition: I could be able to run the proxy on any infrastructure that I like. Not only one Google's cloud offering.
And on the second essential condition that marketing departments act ethically. They can send the web analytics data to whatever tool they like. But they should absolutely not send my identifying information with it. They should use the proxy as a privacy protector. The same when sending conversion data to the marketing tools. I am OK with the marketer sending information back that a specific ad (not a specific user clicking on a specific ad) led to a conversion.
I don't need Meta or Alphabet tracking me personally (or my clients'users) with every click. But I understand the business need to measure the effectiveness of marketing money spent. Solutions like these could be a way to achieve this. If done right. And not done in the way GTM does (only hosting on Google, using an A/AAAA subdomain, grabbing every cookie possibly and so on).