If that's true, then E2EE will never become mainstream. Consider this scenario: "My phone got lost/stolen/broken, so I just got a new one. I haven't logged in to this app since I got my last phone, so I forget my credentials for it. I'll reset them through my email. What do you mean my conversation history is gone?"

That's not really far-fetched. If you can get your conversation history back in that scenario, then so can the server operator so it's not real E2EE, and if you can't, then by your statement it won't become mainstream.