I've had this exact response from "normie" people I've known over the years multiple times.

My guess is that it stems from the old saying "you get what you pay for", and as such a free service without a megacorp behind it MUST be dodgy and untrustworthy.

What annoys me the most is that when you bring up the topic of privacy it's always the exact same response, "yeah well I have nothing to hide so it's fine"

I'm used to people trusting friends and family members who they know are tech experts. That's a really weird reaction that seems disrespectful toward your knowledge and judgment; you weren't wrong to be mad.