I don't know about this one:

<< Where does GMail go when it is ’deleted’? >>

But when Google introduced the "Trash" option to Google Notebook, it had my previously deleted notes in there, even though I'd deleted them when there was no "Trash" option, so they must have kept a copy despite me believing I'd deleted them forever.

interesting bunch of questions..

Hardcore 'vault' collateral, is the core of any organization. If it ever becomes public, or the vault is comprimised, then google has much to answer for.

After all, its still falls under the mandate of a SEC, entity and thereby SOX's can be leveraged against them for breach of information :)-

I'd be very surprised if internally central data isn't kept under some encryption lock and key. After all, the smartest ICT people around are said to work at google. They must be aware of the dangers of hacking and things like that.

"Are they willingly handing information over to the government behind users backs?"
Weren't they the only ones who didn't do that, recently?

I'd wager that if they are keeping all of it, it's not particularly encrypted, whereas if they're only keeping some of it, then it is probably encrypted. Simply a matter of volume and cost – it costs CPU cycles to encrypt data, and Google sees lots of data.

Mind you, if they're keeping all of it, then they've got unimaginably large data storage, and that would make unimaginably large processing capabilities, well, in line with the rest.

Lets not forget that Google probably has some sort of data backup mechanisms in place, so copies may also be kept there.

From what I hear, "Google never forgets"...

they have an archive of every search ever performed for all of their existence in a data store over which they lost sleep. this is absolutely not a joke. however, does that really matter? the only issue is unique ID paired with queries, as they are not using dynamic generation. this raises concern.