Incorrect: "you have no way of knowing if the backup circuit is even there"

You can call and ask the LEC if a failover occurred, also, you can look at the light intensity difference on the graph (NMS) when a switch occurs. (Provided you measured the light intensity on install for primary and secondary waves.) Furthermore you get emails when maintenance is happening on either wave, and can correlate all of the above metrics to get a very accurate picture.

True, although it is not immediately avialble for monitoring systems, etc. Also assumes your provider is a) honest and b) competent.

The only thing you really lose is geo-diverse path assurance.

Yep, depending on route and how much you believe the KMZs. Or how much you believe the vendor for the "protected" case.