Does iCloud drive use up hard drive storage space?

What don't you understand about Optimize Storage, it seems very clear to me.

iCloud works exactly as advertised and it's certainly far from confusing. Clearly, you prefer to assume how things work rather than actually finding out.

who on earth is going to buy 2TB storage with a 256GB SSD in their laptop and the stored data has to sit on the laptop too??

If it is bought on iCloud Drive nobody with any common sense.

That must be why Apple promotes it's iCloud storage plans and pricing - Apple Support

who on earth is going to buy 2TB storage with a 256GB SSD in their laptop

Most people (that have 2 TB of documents) I would imagine, that's exactly what iCloud is for.

Obviously. Then who would buy it given the built in storage on Apple devices?

According to Apple, "If you need to access a file that you deleted within the last 30 days, you can recover it from iCloud.com." if not backed up by Apple, then where are the deleted files stored?

Deletions are stored in iCloud for a limited time, long enough for you to change your mind.

But it will be at the cost of deleting rarely used files from your Mac

They aren't deleted, they are optimised.

Then I can only assume you don't use it otherwise you wouldn't need to rely on what anyone says, I do use it, I know exactly how it works, they aren't deleted, they are optimised.

TIme Machine? Backup drive that doesn't charge rent?

I'm also finding iCloud to be useless for what I need. I understand the thinking behind storing a copy locally, but what I want is basically the equivalent of a network hard drive on which I can store files without having to have a copy on my computer. I still want to access those files from other computers, but the purpose is to save space on my local computer. I don't see why Apple can't include an option to store files only on iCloud if that's what we want.

I so totally agree with you . . . I too went thru the same notion and am very annoyed. Any updates on this issue by any chance? I will back up all my photos (again) to my external and get rid of the stupid icloud subscription . . .

You're right, it's all about money, which means that Apple is now all about the average consumer who knows little about computers. I understand focusing on design that makes it easier for those people. Storing files only on the iCloud would be an easy feature to offer, but I also understand that if Apple offered that option, they'd have to devote a lot of resources to Customer Support for people who had problems with that. But it's just sad.

I still think that at least those of us who pay a premium should have that option, even if it's off by default and activating it pops up messages such as:

Are you sure you want to activate this feature?
You will not have access to these files unless you have an internet connection.
You may incur data charges if you are using a mobile data connection.

Access to your files may be slow if you do not have a fast internet connection.

That's what I'm doing too. It's become clear that iCloud is a service for mainstream users who don't know much about computers, not for more savvy users. It's just an annoyance for those of us who use our computers for productivity and have files that take up a lot of space. I'm weary of the "your drive is almost full" message, of not being able to open Photoshop or other large files because there's not enough room left on my drive, and of going to another connected computer and having to deal with CPU usage as it copies files from the iCloud to the drive on THAT computer, filling it up too. I don't feel like paying for that sort of thing.