Yes, you are totally correct, the Apple Music service ruined a lot of iTunes libraries. Same goes for iTunes Match/iCloud Music Library. As much as I enjoy the Apple Music service, it was a frustrating time when it was first released.
I dodged the bullet because I had my CD library in Apple Lossless on two different Macs, the first of them only used for the CD library: no iTunes Match, no iCloud Music Library and no Apple Music enabled. So when I subscribed to Apple Music on the second Mac, as well as my iOS devices, and noticed how it was messing with my library, I was able to keep my Apple Lossless CD library safe on the first Mac. This is how I still use a dedicated Mac just for my CD library. I keep it manually curated and don’t subscribe/enable the other services on that Mac.
I haven’t updated the dedicated (music) Mac to Catalina....yet. I have updated my second Mac and MacBook to Catalina and it has kept those libraries intact. Those libraries have all the services/subscriptions enabled, so they have some duplicates and replaced files, but I know what’s there and use them across all my iOS devices without any issues.
I feel fairly confident about updating the (music) Mac to Catalina. I’m going to give it a little more time, just to make sure that no problems show up. I updated to Mojave last year without any problems, but Catalina removes iTunes and I want to make sure my CD library will be safe and that the new Music app sounds as good. Some of the early iTunes versions had subtle sound differences, but later versions sound consistent. So far the new Music app sounds good, so things seem OK.
Please keep me posted of your experience and thoughts. There’s not very many of us dedicated Apple/Music listeners here, so it’s wonderful to meet you and get your feedback.