Amazon S3 - primary storage

When I use “Amazon S3” as primary storage, is traffic passed to my server?

If you access your Nextcloud, all traffic goes through your server. You can of course access external storage directly (bypassing Nextcloud completely).

Sorry to reopen this.

But does desktop/smartphone sync’s also goes through nextcloud server(if installed in EC2) and gets saved in S3? I am aware that meta are saved in DB.

All the nextcloud clients (web-interface, desktop and mobile clients, direct webdav connection) only communicate with the server.
You can directly access external storage but you must bypass Nextcloud.