Missing files and apps

I am still using Catalina--yes, I know.

I have my iCloud settings so that everything on my Desktop is backed up. However, when I booted my laptop a few days ago, I saw that all of the files that were on my Desktop (and backed up to iCloud) are no longer on my Desktop. It's like looking at a brand new desktop. I'm also missing many of my apps in the Applications folder. They are now greyed out--basically everything I haven't downloaded is the last month or so, including one called "Install macOS Monterey". Is this because I'm still using Catalina and have refused to update my software? I can still use Google Chrome, but it's greyed out in my Applications foler, along with Excel, Word, QuickTime Player, Safari, Spotify, etc. I can also still access my Desktop but ONLY by going to the Desktop folder under iCloud Drive. My local Desktop folder is completely empty.

Other than clicking "Learn More" and apparently downloading--but not installing--Monterey, I have not made any changes to my settings.

How do I once again gain access to all my apps and all the files that were stored locally to my desktop (and backed up to iCloud)? And was it the Monterey download (and lack of installation) that broke my current setup? I don't want to install it unless I know it will fix my setup instead of breaking it further.