macOS: Does activating iCloud preserve "Pictures" folder structure?
It turns out that pictures on iCloud work with the Photos app; photos are "special" and you don't sync the Pictures folder in the same way items on iCloud drive are synced. In order to sync photos to iCloud you need to use the Photos app and copy when importing. If you import photos in-place from an unmanaged location they will not be synced to iCloud.