An option with iCloud is to "Optimize Storage" to save storage space on a disk. This is done with Photos by keeping only smaller versions of pictures locally, and relying on iCloud Photos to keep the full sized files for use as needed. For iCloud Drive, files are kept locally, but if "Optimize" is chosen, then some files may be deleted from the drive, if storage becomes low, and they will be brought back as needed.
Pretty clever, but there are downsides to the "Optimize" choice. For one thing, backups to your Mac will only backup what's on the Mac, and some files may be missing, and you don't really know which ones. And for another, as you've discovered, if you were to end syncing, then you would be left without those missing files that are only at iCloud. This is why there is that warning that comes up when you turn off Sync.
I use "Optimize" on my iPhone and iPad, so I don't have to buy huge amounts of expensive storage when I buy a device. But I never use "Optimize" on my Mac--I try to buy enough (also expensive) internal drive to be able to keep the original files. Since, like you, I use a laptop, I try to clear out space on my internal drive by carrying a very small 2TB SSD for files and backups that I don't use much. I keep the Photos Library and other high use files as Originals locally, as well as in iCloud. There's nothing wrong with syncing, which I certainly do, but I want them fully available for backups.