I’m not sure about transparently, that’s more in the tdarr wheelhouse I’d say. You’d dump the files into a monitored folder and it will replace it with a version transcoded to your specification.
Transcoding video takes a fair bit of time and energy too FWIW, so you’re going to need enough local storage to handle both the full size and smaller one.
I have to question the idea though, cloud storage is always more expensive than local for anything remotely non-temporary, and transcoding a load of video all the time is going to increase your energy bills. If you have any kind of internet bandwidth restrictions that’s gonna factor in too.
I’d say it would be better to save up for a cheap external hard drive to store your video on. For a year’s subscription to a cloud storage service that would provide enough space for a media library, you could probably get twice the amount of storage forever.