That is nothing new, and not really worth such scary headlines either. Of course cortana listens, it's a speech recognition tool, and if you don't like that then you can always simply disable it.
What would have been worth worrying over is if it listens even if disabled, but the linked article doesn't state anything like that, so I assume it is not the case.
First, I agree with your summation: so long as Cortana
stops listening when I turn her off, I do not see the problem.
Second, people who are "scared" of Cortana's access to things need to understand what she's capable of doing. For that, it's worthwhile to look at Cortana where she started -- on Windows Phone. I use her on a daily basis to keep me up to speed on my calendar events, on my commute times, on flight details, and most usefully to do things for me while I'm driving. She can take dictation for text messages, she can read my text messages back to me, she can call people or tell me who is calling, she can operate my Pandora app, all without moving my hands from my steering wheel or even so much as moving my eyes from the road. She can also do geofencing -- prompt me to look at my Costco shopping list
when I drive into the Costco parking lot.
These things require access to contact data (Call from Mother Dearest - answer, or ignore? Hey Cortana, call my brother on his cell. My dad calls, Cortana reminds me to wish him a happy birthday), she needs access to my third party apps (Hey Cortana, play Pandora Orchestral Movie Composers channel), she needs access to my email and calendar (based on my Delta flight confirmation email, she will pop a message that my flight is 35 minutes delayed right now), she needs access to my text messages (Text message from Doug Wines: Read it, or ignore it? Hey Cortana, send a text to my Wife, tell her I'll be five minutes late getting home), and she needs access to my location (I arrive at Costco, reminder pops up for my shopping list.)
For a phone device, this is the bitchin'est thing ever. The way that I currently use PC's, maybe it's not as useful right now. But if I had a Windows tablet and was a mobile warrior, I'd be all over these features for the same reason. Shit is awesome, but to get use from it, you'll have to let go of the reigns. Is that scary for some people? Yeah, it is, and rightfully so, thus let them turn it off.
I have Cortana turned off on all my PC's, and I have it turned on for my WP 8.1 phone on my Lumia 1520. I'll continue to use her, because she's INCREDIBLY useful when my phone is tethered to my car's head unit.