On the one hand, I agree that the capability is concerning,
but if it only records the behavior within a single visit and doesn't correlate it with an account, or across multiple visits, or across websites at all, I think that that probably wouldn't be much of an issue, for me at least.
However, I don't see a way to allow that without also making the aforementioned unwanted connections also possible.
This is a bit better than it used to be. At one point the documentation had a field for User Email Address, and only a footnote in some documentation suggested it be hashed. Still, for a company that chooses to use the feature, the session recording can be tied back to the user account and any data already associated with it.
Hashing email addresses doesn't really work. Most people don't use unique addresses per service and its easy to get a large list of email addresses that you can hash and do lookups in.
However, I don't see a way to allow that without also making the aforementioned unwanted connections also possible.