Which both mean that you cannot really trust Azure. Although the latter is an easy mistake to make for hosting providers and thus indeed a valid threat model.

Which both mean that you cannot really trust Azure. Although the latter is an easy mistake to make for hosting providers and thus indeed a valid threat model. The theft scenario is exactly the reason why you wouldn't want to trust Azure to do the encryption for you, since they can just extract the plain text data from the virtual machine. Unless you are saying you don't trust Azure datacenter techs only? And for preventing the leakage from old storage devices very non-fancy and simplistic encryption setups are good enough (most of the complexity comes from trying to prevent/detect MITM or manipulation by the hosting provider).