though it's status claims "Updated Just Now".
Updated just now means that Photos has updated all information about the library, but not, that all originals have been downloaded in the full resolution. If you are running low on storage, Photos will stop with downloading originals, even wit "Optimise Storage" disabled. Tony is right, that 7GB of "available storage" are needing attention immediately. I noticed on my Macs that even 20GB of available storage will make Photos pause with downloading originals.
whether I should be paying for and can trust iCloud with my data.
You certainly can trust iCloud with your documents and data, but iCloud does not suffice as a backup.
You always need an independent backup copy of your data, whether you are storing them in iCloud or locally on your Mac. Having your data only stored once and keeping working your only copy is a disaster waiting to happen. You need an independent copy of your documents and data and your photos that is kept safe and that you never touch.
Are you making regular backups with Time Machine? That would be the easiest way to keep your photos save, unless you are using "optimise Storage".