Why the hell wouldn't anyone? I mean, expectations of privacy have eroded, but "you used this company's product, so you must be giving them permission to see everything you do with it" is an argument that, despite many companies' attempts to push it as just common sense, doesn't and shouldn't fly.
VSCode collects telemetry these days.
I completely agree that it is the status quo, but it shouldn't be. It's unreasonably for people to be surprised by violations of privacy, but I don't think that it's unreasonable for people to expect respect for their privacy.
In that context, companies do their best to guess what their users want and ask for explicit consent when they can't. In Google's case, once we actually dig down and unravel the complaint that was filed by the Texas AG (https://www.texasattorneygeneral.gov/sites/default/files/ima..., page 55-ish), the claim is Incognito mode doesn't stop targeted advertising based on browsing behavior because the fact that browsing occurred is known by the servers. Well, duh. Of course servers have a history of access to them; expecting them to not is like expecting Amazon to not have a list of people that ordered from it (how are they supposed to ship you what you ordered if they don't know that?).
And in the cases where people have gotten retargeted ads because they went incognito and then logged into Google... how the heck do they figure they're in any sensible way "incognito" when their name and face are at the top of the page they're viewing?