Your understanding is correct and after Step 1 I doubt I did something else, but do please note that I added the Encryption module or something similar like that, where I also installed Nextcloud Talk, I apparently can’t find where I did that anymore…
I did not follow the documentation, that’s true, since I did not expect for it to be so complicated, there was no warning about it either. The encryption key was never displayed to me…
Is there a way to fix this without the backup? All my files seem to be not encrypted so far, I can still view them. I am not 100% sure on the last sentence though