So, yes, privacy is going to be a concern, yes the institutions will not make digital euro anonymous per-se so I my view we should expect it to be very unlike cash and yes it does open the door to making cash restricted for very small payments and thus having a massive control over people.
Think of the panic among current cash holders.
What If I had 100 thousand in cash at home right now and heard in the news that next year I won't be able to buy a car anymore. All I'll be able to do is grocery shopping or paying in restaurants. Crazy!
Now due to low interest rates people are withdrawing cash and they want to stop it by making cash useless, that's their main goal.