But isn't it a jump from that to "remote root on every Android device that has market installed" and "If your device is online, it's a few hundred bytes over an always-on socket away from remote install/wipe" (remote install yes but wipe?)
If you have a Google account, then you trust Google. If you don't trust Google then it would seem silly to have a Google account.
The ultimatum you describe (which is also the present reality) isn't the only possibility here. Even a simple confirmation dialog box is enough to prevent a situation where an evil actor could silently mass-install malware on every Android device, or for that matter an authoritarian actor installing legal spyware outside the device owner's control.
The simple fact is that there is a socket connected on the phone to my left, with exactly the features I just described. Just as it can produce apps at my leisure, similarly it can be used for less desirable actions. In the past, Google have used this legitimately to remove malware, but it's not Google I'm concerned about. One nationstate (China) has already shown Google's production environment little more than a few nasty PDFs sent to the right e-mail addresses away.
As for remote wipe, that's a feature of the platform – search for 'android device administrator'.