I just tried, without disabling anything in Golden Gate. It did an iCloud Drive search. It doesn't seem to be working very well.

Did you go into Siri and join the waitlist for Apple Intelligence?

If not, you’re still using spotlight so the behavior is 100% expected.

Yes, Apple could do a better job making it more obvious but then again Apple Intelligence is Beta so I can see why they require a positive action right now to enable it.