If you can setup offline synchronization and data encryption, there is no reason to not use cloud computing.
If your provider does not support this, then it's time to change it.
See, the thing about that kind of backup system? It takes effort, which is precisely why people have been switching to cloud computing. I hear plenty of people making this kind of snarky remark who use cloud computing. But how many of them are backing up?
Furthermore, if you're going to the effort of maintaining a backup, in most cases it's just as easy to run a local free and open source software equivalent. So in that case, why bother using "cloud computing" at all?
You're right as for there being no hardware support for decoding Ogg Theora. I don't know enough about that to make a comment (I wonder if it is possible to make such a thing but whether or not it just hasn't been implemented). As for the rest though, the quality argument is simply not true... it looks as if in some circumstances, in fact, theora comes out on top. But even if that isn't true, we can see that it's close enough that it isn't a significant difference.
As for the submarine patent stuff, that's FUD... every codec technically has that threat. But Theora is the only one not known to have any current patent issues. h.264 has several known patent issues, but of course Apple is not worried because they are in control of that. But what about everyone else? In fact, unlike Theora, where steps have been taken to avoid patent issues, the dangers of patents are already known when it comes to h.264.
Please don't spread this obvious bullshit. One codec may have patent issues but nobody can find them. One codec has obvious and known patent problems and may have even more that nobody has found. If you're going to make an attack on the former for patent issues, you'd better not be supporting the latter.
Linux boxes are rootable. They *should* be rootable. The only time they aren't are when you don't have control any more (because of DRM & etc). But then they are only Linux in as much as the Kernel goes, not as much as the kind of Linux that Linux users advocate. I've recovered a broken plenty of times by popping in a boot cd and chrooting it.
The only time a system can be protected from this type of stuff is if it's encrypted. But then again, that's only protecting someone from accessing information you want to keep private, not protecting from reinstalling your operating system.