It is a hash of executables, not files. It does include shell scripts.

The intent seems to be malware prevention, but yes, the implementation is terrible from a privacy perspective. Far better would be a local bloom filter or similar.

But the bit about Windows being more respectful of privacy is not correct, or at least substantially more complicated. For instance, if you run 'full' telemetry, Microsoft can, in fact, pull your documents from your machine and execute things on it remotely, something I've seen no indication Apple does.

https://answers.microsoft.com/en-us/insider/forum/insider_wi...

It's because of app notarisation. Here's one of the writeups on it: https://lapcatsoftware.com/articles/catalina-executables.htm...