Another independent search company with its own index is great. Repackaging Bing and Google isn’t good enough. I’d be cautious with their privacy claims though.
Would an encrypted backup using something like Crytomator or Rsync fit your needs? It would allow you to use the cheaper cloud services without letting them see the content of your files.
AAC is higher quality for the same compression level and generally preferred by Apple. MP3 should be fine too though.
EDIT: To be clear though, the programs I listed can handle all kinds of codecs including AAC and MP3. fre:ac is also good for ripping CDs if you’re into that sort of thing.
If you really need to convert the files to something like AAC for native iPhone playback, I would suggest either fre:ac (audio only) or MKVToolnix (video and audio).
it also assumes that one person’s results on Google are the same as another’s. Sadly with the enshittification of the internet, we can’t take it for granted anymore.