Sprint is now Tmobile. Why do I have to use a SIM card? Does it compromise personal info? Can the carrier control phone and cellular performance by a SIM card?

All a SIM card does is contain the basic information to allow your device to connect to the T-Mobile cellular network using your account with T-Mobile. SIM cards are required to access LTE and newer 4G enhanced and 5G networks. So no way to connect without using one (Verizon and the previous Sprint require SIM cards and have now for years to access their LTE and newer networks).

On an iPhone the SIM contains no personal data at all. Nor does it provide any hollywood’ish “back door” control of your device, nor access to any of your device data.

T-Mobile becoming Sprint has nothing to do with the need to use a Sim Card. A Sim card contains the information about your phone number to connect to the carrier you use. There is NO OTHER data on the sim card other than the cellular path to your phone number. And without a Sim card installed either physically or via eSim, you wouldn't be able to make or receive phone calls.

Yes, carriers can refuse to unlock a cell phone to be used with another carrier IF the customer owes that cellular provider money on the account or has a contract with the carrier for a specified period of time. For example, if a customer buys a phone subsidized from a carrier, the balance of the subsidy would need to be paid off before the carrier would be willing to unlock the phone for use with a different carrier.