Which is one of the aspects of why the DMCA is such bad law and DRM in general is a complete waste of time.

If you hand someone a stream of bits and a decryption key that turns it into a movie. They will figure out how to keep the decrypted movie around if they want or need to do that.

So then you get into a coevolutionary arms race where content licensing organizations feel they have the right to imposes draconian restrictions on peoples personal electronics. And mandated spyware is not really ethical either.

If by "elephant in the room" you mean "something nobody gives a single shit about." Seriously, why should I care?

Should File->Save Page As... be considered the "elephant in the room" when Firefox is discussed?

Hrmm... I'm not sure. At any point in the protocol is there a "copyright bit"? It only takes one bit, and it doesn't even have to be documented as serving that purpose. The StreamboxVCR case ended up cementing into law (because the Streambox people ran out of money and couldn't appear to answer the last appeal by RealNetworks) that disobeying one undocumented bit is all it takes to run afoul of section 1201 of the DMCA. I imagine there might be such a bit in the YouTube stream but I don't know. I'm also not sure how you could defend in court that creating the temporary copy in memory for purposes of playing a stream is given permission, but creating a more permanent one is not. Courts have held that transitory copies in memory are actual copies, and can constitute real infringement, but obviously YouTube gives implicit permission to users to the creation of that copy, and youtube-dl doesn't actually create any additional copies beside that, it just keeps it.

I think it's already been ruled (at least in Europe), that it isn't illegal to download from public streaming platform since "streaming" and "downloading" are the same thing.

I'll go check.

Edit: After checking, yes, of course as long as it's for personal use. It's against youtube TOS, but if the TOS is against the law...