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People have a right to privacy.
One of those opinions is wrong, uninformed, and the user is so desperate for an simple and easy trust metric they arbitrarily glom onto anything in arms reach and engage whatever confirmation biases will support their thinking.
A lot of people are clueless and are making arbitrary judgement calls and assuming those are rational/reasonable.
Since you're aware of the schools of thought on the subject, it does seem like you do know why people don't like private profiles. I think you might not understand why people make bad assumptions and bad judgments. Hint: they're human.
If anything, shady people will have public profiles designed in such a way that tries to make them look as honest and normal as possible.
Personally, I set up my profile the way I did - private except for the comments - primarily to annoy the nosey people and the ones who continually complain about people who cheat achievements. It has often brought me great amusement.
It doesn't really matter if a profile is private or public, people will always try and find something to use against others. Your example of someone doing well and having a private profile, if it was public people would still look for things to use in an attempt to devalue the other person.
Social media has warped people into thinking they're owed every bit of info, even though the opposite is true.
I think it's a bit of a shame, but that's only because I really enjoy all the interaction which you can do on your profile. But at the same time I can fully understand that some people don't want to bother with all the possible issues... for example people commenting on your profile while you don't really want 'm to?
Also... keep in mind that "private" can also imply "friends only". I still recall someone sending me a friend request while they had a private profile.. I wasn't sure if I should but eventually decided that, sure, I'll add them and lo and behold: suddenly I got to see a lot more of their profile.
I think it's a good thing that Steam provides this feature and it never bothered me before.
And being human doesn't = making bad assumptions and judgements
Sure it does. I outlined my take on it, arbitrary and bad assumptions, ignorance, confirmation bias. Why do people do those things? All human beings do those things.
The more aware you are of human behavior the more you can do to mitigate some of the common mistakes you might make. But it'll always be a part of being human.
Have you ever met another human being before? I'm not saying humans are incapable of anything but bad assumptions and judgments. But if bad assumptions and judgments were a product we consumed, it would be one of the most popular products on the planet. You'd have a case in your pantry right now.
I love when people rage about me having lots of achievements on lewd anime games
People even rage because one have "too much badges you should spend money on games"
Edit: fixing typos