Absolutely, I use Google for pretty much everything and trust them implicitly. I don't believe that Google will leak anything that matters and think that the whole buzz furore is nonsense whipped up by people who had assumed privacy where there was little reasonable expectation of it.

However, if, like the OP, you do not trust a major corporation with a near-immaculate record on data integrity and an industry-leading stance on LEA disclosure, why trust any corporation?

Hosting your own server is inherently risky, but it is a different sort of risk with different mitigations. As you allude to in your post, the question is whether you fear malicious individuals, the workings of the state or corporate incompetence.