I don't buy this because everyone I know turns off iCloud Photos when it causes you to run out of your measly 5GB of free storage space, which makes the OS insistent about you fixing it to fix backups not uploading. For the people that do pay more, they keep iCloud Photos on specifically for the photo syncing aspect.
Similarly, I am not aware of any constitutional rule that prevents a private company like Apple from installing client-side software into your phone OS that scans the local photos on your private device even if you never upload them, as long they don't do the scanning at the government's direct behest and you give them permission by agreeing to their ToS.
The important constitutional principle here is "is this private company acting as an agent of the government." The important civil principle is: "do we, as citizens and customers, want our government and phone manufacturers to scan private files and submit automatic police reports." Once you've decided those questions, the physical/logical location of the files is a detail that only we nerds care about.
Fortunately Apple has abandoned that plan and now supports full end-to-end encryption for iCloud Photos. It’s still opt-in, but hopefully that will get easier in the future.