You’re absolutely right to be thinking about privacy tradeoffs. New WoT tools are going to give us new tradeoffs that we’ve never been faced with before, and it will be important to think them through carefully.
The ideal scenario is not that no one knows anything about us. The ideal scenario is that we have the power to select with great precision what pieces we want to share, with whom, and under what circumstances. For example: I may want members of some very specific community (homesteaders or members of a network of citadels, just to use one example) to know some particular piece of information about me, but I don’t want to broadcast it to the whole world. But maybe membership to this community changes over time, I can’t curate it manually, I don’t want curation to be centralized, so I want my WoT to help me keep track of who’s in this community. These are the sorts of tools we want to build.