How to resolve frequent desktop file disappearance on 2023 MacBook Pro?

Good evening, John Galt. I had a very productive call with Apple Support on Saturday afternoon, and I am happy to report that my MacBook Pro is now running like a new machine. The summary version: We reinstalled macOS. However, I'd like to tell more about the experience for the benefit of other Mac users.

I carefully explained to the Support rep all the steps I'd taken on my own: Safe Mode, Disk Utility/First Aid, and that none of those efforts brought joy. The rep had remote access to my machine, so he could see for himself what was going on. (Sidebar: I've had some experience with remote access before, but this session was different. The rep could see my machine, but he could not do anything with it. I was the one who opened and closed windows and apps and so on, while the rep guided me. This seems to be something new, and I rather liked the approach.)

Before I called Apple Support, I had tried several times to reinstall macOS on my own. Every time, I found that my system lacked enough space to install macOS. I mentioned this fact to my support rep. He and I tried, without success, to find enough apps and files to delete or move. In the end, I had to sign out of iCloud. That seemed like a drastic move that was destined to land me in computer purgatory, but it worked. Signing out of iCloud meant that all those files that were hogging space on my SSD were corralled in the Cloud. My SSD now had plenty of space to reinstall macOS Sequoia.

Installing Sequoia took a couple of hours and concluded with signing back into iCloud. (Whew!) Then followed the rebuilding of the rest of my setup. I had to reinstall my printer, of course, and reinstall Parallels and Windows 11, but that was rather quick and easy. It helped that I had all my product keys at hand.

I now have my system back the way I like it and even better than before. In the process, I learned how to use my Apple Watch to unlock my Mac without having to use my password. I didn't even know I could do that! Thank you, Mr. Galt, for your help. I hope my experience will help other Mac users who encounter the kind of trouble that I had.

You mentioned that "[lack of available storage space] is likely to be related." Today I followed the advice I found at Apple's support page—102624—in an effort to find stuff I can dump. Well, the biggest pig in the pen is iCloud Drive, which eats up about half the space on my 500 GB SSD.

I stay confused about this iCloud Drive thing. I understand it's not intended to function as a backup or online storage. I pretty much understand how iCloud Drive works, but I don't understand this: System Settings >> Storage reports (screenshot below) that iCloud Drive "is using 239.87 GB of storage." (Then it adds, "Files and folders kept offline are using Zero KB of storage.") I've turned on Optimize Storage. I've moved my Photos library to a 4 TB external drive. What can I do to reduce my iCloud Drive's load on my local hard drive (SSD)?

If I need to reclaim 20 GB of free space so I can reinstall macOS Sequoia, it appears iCloud Drive is where need to look. Heck, all the applications I've installed on this drive don't add up to 20 GB!

Thank you, John Galt. I didn't mention that my laptop is still covered under Apple Care. I think I should simply contact Apple Support and get some of that help that I've paid for.

Last night I tried reinstalling the OS, but I ran into a space issue. Recovery told me I need almost 20 GB more space before it can reinstall! But that's another story for another time. Thanks again!