Is there a reason I should not set my default data location to google drive when setting up PostgreSQL?
There are two good reasons not to use Google drive for your data directory: data integrity and performance.

The second is obvious because of the latency.

For the first: Google drive is a file server. I am sure that it does not offer the guarantees required by a relational database, particularly that you can reliably sync data to disk. Even a Windows file share does not offer these guarantees.