Right, the people at Meta aren't stupid. They understand fully will that users posts aren't the issue, but steering the debate in that direction would make the EU look unreasonable.

Meta could be more accommodating to the wishes of the EU and place a greater focus on privacy, but that would mean changing how they do business. Meta clearly don't believe that it's possibly for their businesses to be profitable without data mining the crap out of their users. I know it's not a popular opinion, but business like Facebook and Instagram are the direct reason why the EU feel the need to step in and regulate.