So first, no, all the files should not be accessible : There are special not "files", but keys, like the key used for this method. These keys pose a huge security risk of they are leaked somehow. The key can be something used to encrypt the device/disk, encrypt a connection, and other things associated with encryption.

And because of that security risk, they are often stored in a special chip or simulated chip (like the simulated tpm 2.0 on pc cpu), and not just "stored" so any malware or who knows what can access them just by reading the drive.

Second, the key is never transfered. When you connect to another device, that other device will get another key. Or maybe could it be backed up somehow in case of recovery on another phone? But that would defeat the entire purpose of this.

How Google can do to allow you to connect to another device if the first one is lost, not sure. But it would certainly either ask for a password and a 2fa method.