I have not seen this discussed too much, but we use iCloud Photo Library extensively to save old photos. We try to stay in the free 5GB tier, so the algorithm is:
- Use iCloud Photo Library like the old Photostream, but it saves all photos up to the 5GB limit.
- Every so often get on a Mac and go through these photos, edit and delete them and put them into long term photo storage. This is a RAID-6 NAS with backup to another NAS, to CrashPlan and then an FTP server. (Ok, I'm paranoid).
- When this is done, create Shared Photo Albums for trips and things for sharing (most everyone with an iPhone just get these, for others, use the web sharing feature).
- Delete the photos from Photo Library and you then see curated content in the Shared Photo Albums.
The problem is that Apple often gets confused about how many photos are in your library. Even if you delete all photos, you will often see the "You need 156GB to upload and your photos), even though everything is clean.
The solution I've found is that you have to toggle the Photo Library button in Mac Photos or iOS Photos, this seems to make it happy again 🙂