A Google search on "how to use iCloud" will turn up a number of "how to" dialogs and videos for iCloud. Apple also has a number of how to articles and videos
on their site.
Conceptually you can make iCloud a very exotic and mysterious thing or, as I prefer to think of it, iCloud is simply an invisible hard drive that happens to be connected to my Macs and iOS devices at the same time.
There are caveats however,
- Not all apps can access iCloud, and in fact only apps that have been purchased through App Store or the iTunes App Store
- not all apps purchased through those two sources can access iCloud.
Your security concern is well founded and Apple demands very strict requirements for any iCloud aware app. This irritates some developers who chafe at Apple's security oriented constraints. Personally it makes me feel safer. I look forward to a day when I no longer need Dropbox. Not that I have any objections to Dropbox, I don't, but it would be just one less network connection from my various devices and one more potential source of vulnerability.