Yes, we are in agreement. I did not say "one single user".
Regardless, I think it's pretty bad design. I would naturally expect a file named "My Document Name.gdoc" that's sitting in a folder on my desktop to actually contain the contents of my document. That's how files normally work. Doing otherwise goes against longstanding convention.
I don't think you can... I don't see an "empty trash" button anywhere though. You can't permanent-delete a file just by removing it from a folder on your computer. You have to log in to the website, right-click it, select "delete", click the trash icon at the top of the screen, right-click the file again and select "permanent delete". That's not even close to what happened to OP.
The complaint is that Google Drive's UI is confusing, and can lead to unintentional data loss. Dropbox has a much better UI, and it's harder to lose data by accident.
No. No, it's not. I have experience with Google Drive, iDrive, SkyDrive and DropBox. The only oddball one that leads to losing data like this is Google Drive.
With SkyDrive, it works very similar to DropBox. Your cloud drive is just a folder on your disk, synched between multiple computers. If you move a file from your cloud drive to your local drive, it moves the actual file - not a pointer to it.
Google Drive is a terrible morass of confusing design. It's not an exaggeration to say they should shut down and start over.
Except when you copy files from your hd or flash drive, you except the copies in the new location to actually be files. That's how every drive I've ever used works. That's not how google drive works.