99.99% of the time only a single file changes at a time, which is the use case here.
Installing on a desktop, laptop, and mobile device would bring 3 clients into the mix right away.
So the user’s first use is likely to be one of the more complex operations, and the one they absolutely needs to work, as a failure here will lead to the user looking elsewhere for a solution.
You are almost guaranteed that the first sync results in zero conflicts. It's just a mass-upload. Even if you bring other clients in, there is still a very low chance and "last-one-wins" is a pretty decent policy for who gets the original filename and then other gets a " (copy)" suffix or something. Doesn't really matter as long as it's documented and intuitive.
But you’re right that there are many such error cases to handle if you want a real iCloud / Dropbox alternative.