Maybe this is a bit much, but developers do need some data as to how their app is performing in the real world. You might have some metrics that says 0% of visitors to your order checkout page on FooPhone 1.0 are completing orders successfully. With a screenshot, you can immediately see that that screen doesn't even work on that device. It doesn't sound like a tragic loss of privacy to me, but rather an important tool for developers to help smooth over the reality of massive device incompatibility.
As a user, I don't care at all if it makes dev's life easier. I bought the app and don't want my personal info to be leaked.
It might be one more place to screw up, but so is just having more actions your app can do.
I'm not sure I see any difference between an app recording all I traction within it (for single purpose apps, but not browsers) and a store video recording everything in it.
Correct. The payment code is usually gone over with a comb for PCI compliance (or completely outsourced to someone like Stripe), whereas the UX tracking is much less so. It's also a common enough issue that stuff like credit cards or API codes end up leaking into logs.
That said, my point isn't necessarily that you should trust apps gathering UX metrics more, but that you should probably trust all apps quite a bit less, whether they track user actions or not.
Most of these kind of tools (ie:HotJar) have a flag that will prevent theses data from being sent.
I realize there isn't functionally much difference within an app. But unless I'm reading it incorrectly, it's not recording the screen it's just the UI of the app. That's not nothing, but I always assumed (sadly?) that a lot of apps have been doing that for years to hone their UX dark arts.