Sorry, this may be a silly question, but is it possible for PyCharm (and other IntelliJ IDE products) to define a specific working folder / path for the file index-the-world feature to stay within or does it always permeate through the entire computers hard drives, just in case?

It works similarly to git. You define a project root, and then exclude subdirectory trees as needed. I believe there's a way to add additional directories outside the root if needed.

I had the same experience with a Vim plugin called Jedi. It was great, but typing "pdb." would freeze Vim for 5 seconds. IDEs can definitely try to do too much.