As long as your "music and whatnot" was purchased from the iTunes Store, the iCloud most definitely serves as a free, permanent storage bin. Why would you say otherwise?
I would say otherwise because many are assuming to view this service as a storage bin from which to stream their library. This isn't the case. These iTunes purchases and subsequent iTunes Matches are still stored where they always were in Apples servers. The only difference with iCloud is that if you change devices or something, you get to re-download them at no cost - from the same servers they've always been on.
In essence, you're not storing your music on their servers, they're allowing you to re-download it, because it's always been there.
Well it's a storage bin for purchased music, video, iOS apps and books. And if you subscribe to iTunes Match, it's a storage bin for all your music.
See above. Again, iTunes Matching your library does not send it up to your personal iCloud. You simply have access to it. It must still be downloaded to your iDevice for use.
Not once during the keynote was the word "sync" mentioned.
In fact it was specifically avoided, and noted as such in various reports from the bloggers, reporters and such.
Don't get me wrong I'm not challenging you as there are many unanswered questions.
That said, please clarify what you meant when you said "until you get it to where you need it to be? "
Correct. He didn't mention syncing, nor did I claim he did. What I'm talking about, though, is syncing. I don't know what else you want to call it.
What I meant by that is, for example, Photo Stream - It serves to ensure your photos are tossed onto all of your linked iCloud devices. At some point though, if you don't save them, they're gone. In other words, they're available via iCloud until you get them to where you want them, or need them to be, to be stored permanantly on that device as opposed to impermanantly on the iCloud.