macOS 26.2 (Tahoe) Update changes iCloud Drive Settings
I recently updated to macOS 26.2 (Tahoe) and started receiving this warning:
Your Desktop and Documents folders are currently syncing with iCloud Drive.If you continue, items will be removed from both folders on this Mac but will remain available in iCloud Drive.
New items added to your Desktop or Documents folder on this Mac will no longer be stored in iCloud Drive.
As an FYI to anybody else seeing this, it's because the update turned off "Desktop & Documents Folder", and turned on "Optimize Max Storage" without any warning/indication.