[abalone]

No, Apple doesn’t need to know your backup key to reset your password and retain backups. I explained why in my previous comment. If they’re not stuffing it in iCloud Keychain (yet) it’s not because the infrastructure can’t support it in principle. See: iCloud Keychain recovery. It’s probably just a matter of maturity; they still haven’t rolled out iMessages in iCloud which is a similar case.

[comstock]

I think they want to support the scenario of lost device, lost password, but still allow restoring data to a new device.