iCloud Drive taking up large space on my Mac hard drive - Why?

I have a Mac 27" desktop, iPhone 11 and a MacBook Air. My wife uses an iPad. Sometime ago I activated the minimum iCloud account to share with my wife for secure saving of passwords. A few days ago I saw it was possible to share Desktop and Documents with all my devices via the iCloud without understanding the unintended consequences. So, despite taking out a larger iCloud subscription I now find that this move seems to have made a dramatic change in the composition of the Hard drive on my Mac desktop. I now find I have 381.18GB of my 1TB hard drive taken up by the iCloud Drive. Also, despite my settings storage details tell me I have 137.6GB in my Documents folder, that folder appears empty in Finder.

In all honesty I do not need to access Desktop and Documents between my devices and have a Time Machine backup on an external hard drive for data security, so what do I need to do to get back where I was a few days ago?