I understand they are billed that way but in practice I don't believe they fulfill that goal, as the job of making the messages unreadable is mostly already don

I understand they are billed that way but in practice I don't believe they fulfill that goal, as the job of making the messages unreadable is mostly already done by transport security (SMTP TLS). Sure it can protect against some things if the mail server is the target, but as we see here, there is still a large amount of identifying metadata that they (unavoidably) have on you. The goal with "privacy" is to ensure that your communications are undetectable and unidentifiable, and I would hardly call it that if it's still regularly going through a well-known mail server attached to a highly identifiable account. And of course it depends on how much you actually use the E2E encryption which is technically optional, for example if you send/receive a lot of mail from gmail users that aren't using S/MIME, which still seems to be the case for a lot, then it won't be enabled and your messages are still vulnerable in a server hack.