Well, first of all, the anonymity set of 'all UTXOs' is much larger than 'only the clean ones', so by definition, not caring about taint gives you more privacy.

You just told me your friends care about privacy, but then you are telling me they use a centralized exchange. This doesn't add up. If they care about privacy, they are using a decentralized exchange which doesn't care about some arbitrary party's definition of taint.

Exactly. I don't know why he keeps asking; I told him repeatedly as well, that the solution to 'taint problems' is to simply avoid services that can out of the blue say 'oh these coins are tainted, we froze them'. Like, this is horrifying. What if I win a contest like Bitcointalk 2021 or someone donates me money, I need cash and send it to an exchange, only to find out they are allegedly 'tainted' and got frozen? This is not an argument against mixing, it's an argument against centralized exchanges.

I believe there was a report about something like 99% of $500 bills having measurable traces of cocaine on them or something like that.. Similar story here, probably. Imagine a store would start scanning every bill and if there's a sign of cocaine on it, not only refuses to accept the bill, but confiscates it. People would outrage!
But Bitcoin investors who have understood nothing about the technology and core principles, just accept such a procedure and get themselves a cash-scanning machine to make sure their paper bills have no such traces. Insanity!

Exactly. I want people to understand that actually, there is no taint. It's an arbitrary tag that anyone can put on anything, yet in the blockchain world they take any random company's word as the universal truth and just accept their subjective opinions. This is so bizarre since Bitcoin is so based on freedom and independence.