I assume it not completely locked down, but does it mean Google doesn’t have access to everything like I assume it does with Android?
Even without explicit installation of GApps, Lineage still uses and connects to quite a few Google services in the background.
It’s a great way of keeping older devices up to date, but not much more than that.
Yes, this is the crux of LineageOS. There is a fork called DivestOS that is more libré and reduces dependence on Google services, as well as having bootloader re-locking for some devices.
From what I get, if your phone is anything other than a Pixel still within supported lifetime, then LOS is decent. At that point it’s mostly a hardware tradeoff (use a phone that all of has active lifetime support, is bootloader-relockable and has Custom ROM support) than a software one.