Or if CoPilot starts exfiltrating data to Microsoft so their server farms can ‘analyze’ it.

I’m not heavily involved in the space, but I’m given to understand that MS isn’t very clear about what happens to your data or how it gets used or shared.

Perhaps Microsoft will be smart enough not to allow the general public to query trade secrets or government data that’s been pulled via unwanted copilot integration.
But maybe the ongoing Russian hack of Microsoft will make it irrelevant, because the servers can be accessed directly.
Or perhaps at some distant time, Microsoft will roll out features or technologies developed using an internal version of CoPilot that has access to all data - including proprietary information from competitors.

And that’s not even counting what ISP’s will do if they find a way to analyze copilot traffic, or what state actors will do if they can set up MitM attacks for Copilot.

Honestly, I sort of fear the repercussions, but I look forward to the lawsuits.

There's no need to degrade performance to get a lawsuit, the simple fact of extrading data can get you in a tribunal, especially from customers with high privacy requirements, or with European sovereign clouds certifications