Having worked on Cloud Run/Cloud Functions, I think almost every company that isn't itself a cloud provider could be in category 1, with moderately more featureful implementations that actually competed with K8s.
Kubernetes is a huge problem, it's IMO a shitty prototype that industry ran away with (because Google tried to throw a wrench at Docker/AWS when Containers and Cloud were the hot new things, pretending Kubernetes is basically the same as Borg), then the community calcified around the prototype state and bought all this SAAS/structured their production environments around it, and now all these SAAS providers and Platform Engineers/Devops people who make a living off of milking money out of Kubernetes users are guarding their gold mines.
Part of the K8s marketing push was rebranding Infrastructure Engineering = building atop Kubernetes (vs operating at the layers at and beneath it), and K8s leaks abstractions/exposes an enormous configuration surface area, so you just get K8s But More Configuration/Leaks. Also, You Need A Platform, so do Platform Engineering too, for your totally unique use case of connecting git to CI to slackbot/email/2FA to our release scripts.
At my new company we're working on fixing this but it'll probably be 1-2 more years until we can open source it (mostly because it's not generalized enough yet and I don't want to make the same mistake as Kubernetes. But we will open source it). The problem is mostly multitenancy, better primitives, modeling the whole user story in the platform itself, and getting rid of false dichotomies/bad abstractions regarding scaling and state (including the entire control plane). Also, more official tooling and you have to put on a dunce cap if YAML gets within 2 network hopes of any zone.
In your example, I think
1. you shouldn't have to think about scaling and provisioning at this level of granularity, it should always be at the multitenant zonal level, this is one of the cardinal sins Kubernetes made that Borg handled much better
2. YAML is indeed garbage but availability reporting and alerting need better official support, it doesn't make sense for every ecommerce shop and bank to building this stuff
3. a huge amount of alerts and configs could actually be expressed in business logic if cloud platforms exposed synchronous/real-time billing with the scaling speed of Cloud Run.
If you think about it, so so so many problems devops teams deal with are literally just
1. We need to be able to handle scaling events
2. We need to control costs
3. Sometimes these conflict and we struggle to translate between the two.
4. Nobody lets me set hard billing limits/enforcement at the platform level.
(I implemented enforcement for something close to this for Run/Appengine/Functions, it truly is a very difficult problem, but I do think it's possible. Real time usage->billing->balance debits was one of the first things we implemented on our platform).
5. For some reason scaling and provisioning are different things (partly because the cloud provider is slow, partly because Kubernetes is single-tenant)
6. Our ops team's job is to translate between business logic and resource logic, and half our alerts are basically asking a human to manually make some cost/scaling analysis or tradeoff, because we can't automate that, because the underlying resource model/platform makes it impossible.
You gotta go under the hood to fix this stuff.