They are not too big to fail for Europe. The EU has fined msft, Google, meta and others. Apple even changed their flagship product to comply.
Why ban them when you can tax them and fine them if they don't comply? Sure, we need to be vigilant of lobbying, but there are no current alternatives to most American tech giants.
I had the first Jolla phone (2015?) and it was okay, but the ecosystem is (was) very shaky. A few apps worked very well, thanks for volunteers and OSS projects but the overall experience was not amazing. Plus some services actively fight against, I remember issues for instance between WhatsApp and the mitakuulu app.