That's really the best approach IMO. Use the AI capabilities of AWS or whoever to enhance features that you can't accomplish locally and that won't really affect anything if they don't work. I haven't seen a whole lot that can't be done locally so it's amazing to me that there are so many products that require their servers to function. I like the devices that come configured that way but make it easy to switch it up.
I picked up a Wyze camera from HD last year on clearance to play with. I haven't done anything with it really, but it came with a setup to do some things locally and others on the Wyze server side (storage of remote access videos I think). There's a really simple modification that is 100% reversible by simply removing the uSD card which makes all functions local and enhanced. It can still utilize any of the Wyze remote capabilities should they be needed, but basically everything can be done locally too. I vote no to Alexa but I'm just one person so maybe automation democracy is dead.