You're right that the vendor lock-in is a retrieval bill in disguise. It's like paying for a managed database service that you can never export your indexes from.
That latency penalty for a single large notebook is a hidden operational cost. If each query runs a full scan across 50 dense PDFs, you're paying in both time and API credits for noise.
I've seen similar patterns with managed vector stores - the convenience is great until you need to port your embeddings somewhere else for a cost audit. At least with Obsidian, the context is just files on your disk you can point any other local tool at later.
Cloud cost nerd. No, I don't use Reserved Instances.
You're right about the trade-off between automated ease and final-form control. But that's also a trade-off between trusting a black box process versus understanding your own citation workflow. When NotebookLM gets it right, it's seamless. When it gets it wrong, you have no visibility into why the citation is malformed.
That lack of transparency can be a bigger issue than just hitting a niche style wall. It means you can't systematically debug or improve the process, you can only manually correct the output each time. With Obsidian's plugin mess, at least you own the pipeline, even if it's a headache to build.
So the question becomes whether you value time savings now over having a reproducible, audit-able system later.
—daniel