The point is, don’t lie about saying you respect privacy with half-baked options and telemetry for me but not for thee bs. If I turn off telemetry, you aren’t allowed to send telemetry. Of any kind. Not a crash log. Not an install token. Not a call home to see if maybe possibly your on an airport wifi and make-our-app-work-edge-case()
When the setting labelled "Allow Firefox to send technical and interaction data to Mozilla" is unchecked, the browser still sends out technical and interaction data through parameters added to various browser-provided/generated URLs (e.g. search results pages from built-in search providers, Firefox documentation links provided by the browser, DevTools compatibility panel links to MDN, etc.), by sending out pings when hovering over or clicking interactive browser-native interface elements, and in several other ways.
In summary: that setting is non-functional and should either be fixed, re-labelled, or removed entirely.