How's that? All my contacts can be stored locally, photos backed up both on my computer and to a separate service plus iCloud, it's pretty easy to set up Dropbox or Box in-place of iCloud Files. Apple Wallet is handy but it really just stores digital copies (over-simplifying) of my physical cards, any of which I can request a replacement for outside Apple.
I don't use Safari but if I did any of its bookmarks/history are easy to import into other browsers.
Your contacts can be stored locally but your device will not work if Apple says so as it needs to be "activated" against their servers. And there is no "secondary system". So no, you are completely dependant on Apple and their infrastructure even if you (think you) store data locally.
Yes, you can do this with considerable effort.
But the moment you use OIDC with Apple ID there is a good chance you will lose many of the accounts created this way.
“Save in an encrypted file”? Christ. We really need to draw a HUGE line between “hacker news user solutions” and “things that are practical for actual people to do”.
I agree, that there is no obvious solution by just enabling a setting...
But no matter what tool you use for it, that is what needs to be done. It is quite simple for example if you use Macpass or Cryptomator on a Mac.
Most people have a file encryption program of some kind on their computers. WinRAR, 7-Zip, some versions of Microsoft Windows (note: not supported in Windows 10 Home), Microsoft Word…
OIDC is the one part of this that really is an outsize problem.
I’d say email providers are an even bigger problem though. Good luck getting your accounts back if you lose access to your own email account. I don’t know that iCloud mail is particularly popular, but the risk really applies to any provider.
I don't use Safari but if I did any of its bookmarks/history are easy to import into other browsers.