Now, sure it is not absolute freedom because it is supervised and the funding was obtained for a specific project. Funding agencies or industrial sponsors don’t like it when the student does something completely different. But then students apply for specific projects. I have never seen any PhD offer that did not have a set perimeter (within which they do have some freedom), so I am not sure they are being lied to about that. Again, that might be context-dependent.
In addition to micro-management of the thesis project, there's also consideration of outside academic activities. Many students end up spending 50+ hours per week on the work their advisor designed. This leaves little time for the student to explore learning new skills that might be relevant to them - for example programming tutorials, a reading group in a different subfield, mentoring an undergrad project, communicating with the general public, etc.
Obviously there is not time for every PhD to involve all of those things, but currently it is much too restricted. For some people to the point that their advisor forbids them from taking a night class or whatever despite the fact it is outside the (already overtime) working hours of the lab. Research may indeed be the priority, but entirely ignoring other parts of the academic role has not gotten us anywhere good.
What it boils down to is that part of the compensation of the PhD is supposed to be training. Yet as it stands many students are treated as only employees, with no regard to teaching them to become a better researcher and no time allowed for their own personal/career development activities.
Students are being lied to for sure (at least in certain fields/locations). But the solution is not to just be blatantly honest about what PhD currently entails. Part of the shift also needs to be a return to considering the PhD as an important piece of the training for becoming an academic.
However, the funding of EMBL works fairly differently from most universities, and quite a few other research institutes.
This minimizes the possibility of ending up with a bully or someone incompetent. And if you do, it's much easier to run away to a different group.
Where would this idea be originating? I think that would be one of the first things I would tackle, because anyone making a claim of academic freedom for grad students to just research whatever they want is spinning a tale. Students with this perception are being lied to, so we should first address the following disillusionment by dispelling the notion of academic freedom during Ph.D. research exists.