[KT3] Collections and syncing (Are books uploaded? Keeping things local?)

The newer Kindle models use cloud collections, which are synced and uploaded to the cloud so their content will be available to other devices. My question: does that only mean the books bought on the Kindle Store?

If I have thousands of ebooks acquired elsewhere and locally stored in the Kindle, and I create a collection for them, would they be uploaded to the cloud the next time I turn on the wi-fi? All of them? Inexorably?

I know there are KUAL extensions for better management, but is the default option so terrible it can't be used for local sorting without syncing, clouds, Amazon, or keeping airplane mode always turned on?