So if I throw out all my Apple devices and forget my current iCloud password, the photos are gone?
Or does Apple store the encryption key for me somewhere as a convenience, so that once I get new decides and reset my iCloud password, I regain access?
That's messed up and makes it certain that I will never use iCloud. Losing my family photos is a much worse outcome than having them accessed by a hacker.
That is what you get when you want real privacy protection, no one but you should be able to access that data. That being said, iCloud is not really a backup, just a File Storage with syncing features, you should get another service (internal or external) to backup your data like Backblaze or a NAS.
Or does Apple store the encryption key for me somewhere as a convenience, so that once I get new decides and reset my iCloud password, I regain access?