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Has Wave invaded my privacy? Does Wave know what else is on my personal computer?

No.

Wave does not scan your computer or invade your privacy.

Copyright holders or their agents collect the information that identified your computer through the file-sharing network or public Internet site to which your computer was connected.

Most peer-to-peer / file-sharing programs require that you share files (allow others to download from you) even as you are downloading from others using the network.
By using a file-sharing program, you are potentially allowing strangers to download files from your computer.

File-sharing programs are not illegal themselves – it’s what is shared over them that can cause problems.

Sharing copyrighted materials without the permission of the copyright owner is illegal.

Please note that unless required by law, Wave will not provide your personal details and contact information to any copyright holders or their agents.