They can't even get messaging right and that's way simpler. I doubt they can get health right.

No way is it simple - there are over a dozen OEMs each competing and advertising their Android phones with the co-branded messaging that they see fit.

The whole strategy behind the Pixel phone was to change the perception of the android brand as a cheap, bloatware'd device for tech dudes. Releasing a recognizable, high quality wearable line fits in with that strategy.

It is simple. Clone Apple's Messages and ship it on Pixel phones. Make it a download so that people can use it with their Google account on other phones.

The hard part for Google is delivering on end-to-end encryption for messages that don't leave their messaging system (similar to Apple's blue bubbles). They really, really want to see what people are saying to each other.

They don't want to get health right. They want to get surveillance capitalism right.

Doesn't have to but could be. And with Alphabet being the giant it is, anything that reasonably could be happening probably is. And I find it a reasonable and scary possibility, even if it's not the primary reason for the acquisition.

Considering that Google's primary revenue is through advertising, and digital advertising's two main problems are (a) identity and (b) context, yes, it is still very much about linking, even if they need to prop up smaller projects or loss-leaders to collect the appropriate data (the secondary value proposition acts as a stepping stone to the first).

the number of fitbit owners <<< number of google identities (for search traffic)

and

data and location from fitbit owners < what they can already get from the andriod phone.

I get the point you are making, I am not denying there is value, but it is a stretch that it is all about data.

In fact, I have heard about companies who had ties with Fitbit to sell location data to third parties. I would much rather have Google be that arbitrator.

I don't work for Google or Fitbit.