Translate what Google does to the analog world. It might look like this: some guy following you around in every shop, every café you eat. He'll note what you buy, what you talk about, what you don't talk about. He'll read your mail to see what interests you (and your friends!). I hope this will help you answer "the real question".
Extending your poorly thought out analogy: in the real world, a person who uses "free" services is equivalent to a homeless person - you get almost everything for free, in exchange for other people getting to see what you're doing. If you care about privacy, you'll pay for a proper home.
This is irrelevant. Google Analytics can be included on any website that wishes to do so.
You can try not using Google services (which is nearly impossible in the first place), but there's no getting away from Google Analytics and countless similar services without installing ad-blockers and browser extensions like Ghostery.
It's the price you pay to subsidise others who use those services for free. I don't disagree with you, this is a horrible trend. The "race to the bottom" with apps will leave them in a similar state (Oh, wait, they're already like that - Airpush style intrusive advertising, etc)
However, quite a few websites have options in their paid plans (Grooveshark comes to mind) where they disable all ads on their website for you. All we need to do is show how important privacy is to us, and to prove that there is indeed a market for paid webapps (regular webapps like Mail, RSS readers, etc)
You are just fear mongering. If you are really concerned and wanted to find a solution, a simple search would turn up that Google provides a plug in to opt out of GA tracking. https://tools.google.com/dlpage/gaoptout
I don't think I am and I don't see how this makes it okay. Services that want to track people shouldn't be opt-out in the first place. It isn't obvious to anyone without some knowledge of computers (the vast majority of people) when they're being tracked.
Translate what Google does to the analog world. It might look like this: some guy following you around in every shop, every café you eat. He'll note what you buy, what you talk about, what you don't talk about. He'll read your mail to see what interests you (and your friends!). I hope this will help you answer "the real question".