Given the changes to their privacy policies, making Cortana a flagship feature, and giving 10 away for free to most of their potential audience, it seems like Microsoft is moving towards the Google style of a data driven business for this OS instead of a product sales driven business.
It'll be interesting to see how (And if) they can make that strategy work, given that the 10%~ ad-network market share doesn't give them an awful lot of scope to capitalise on targeted ads like Google does.
Assuming this is the case, it seems like a backwards way of going at the problem – get the advertisers on board, and surely the users will flock to view those ads.
To the really privacy concerned users, who did read and accepted the ToS and PP - you clicked I agree, so you're obviously OK with the situation. If not you shouldn't use these Microsoft products.
If you're dependent on Windows - you have two options: 1) accept it as it is, or 2) go into a ToS-PP-greyzone, namely using a IP-HOST blocker (like PeerBlock) with a specific list and cut all connections with all known Microsoft's IP ranges - which in fact is a kind of breaking the ToS.
If you aren't dependent on it - go for something else, like Linux.
Most of these don't bother me - data syncing is understandable (and to me it's not necessarily a data-grab - I'm pretty sure most users would do that in the first place), EXCEPT if the scope is beyond what I'd expect. Cortana is also understandable, because an assistant that doesn't know you is worthless. The encryption part is... ecch, but then again 90% of the people I know that need/want encryption don't rely on Windows for that - they either download a third party encryption or use Linux. Though the last point raises one major question for me (if anyone can answer):
What's the scope of this "collection"? Is it Windows-features only? All Microsoft products? Or every single piece of software on the computer (like Chrome or Thunderbird)?