Privacy of USER data clarification

[vidkun]

In many of the USER files, it states "All content here is private and never synced publicly."

Is this data not sent to whichever AI provider (Anthropic, OpenAI, etc) that the user is using? How is it used as context for PAI if it is not sent to the AI provider?

Could you please elaborate on what exactly you mean by 'never synced publicly'?