They have a lot of videos. You're statistically unlikely to care about any randomly selected one. By watching a video, you establish that it's interesting enough for you to watch. It's much more likely that you'll want to rewatch it than that you'll want to view a random video.

I'm only half-joking here. To me, YT algorithm seems to be a mix of "show random videos you've already watched" + "show random videos from channels and users you watched" + "show the most popular videos in last few hours/days/weeks". It's pretty much worthless, but what are we expecting? Like all things ad economy, the primary metric here isn't whether you like the recommended content, or whether that content challenges you to grow - it's maximizing the amount of videos you watch, because videos are the vehicles for delivering ads to you.

Im guessing things like 5 year olds watching the same video 300 times randomly on their parent's account has irreversibly tainted the Googletron into thinking people like to watch the same video over and over again.

Hundreds of times I have told youtube im not interested in a recommended video that i have already watched, seems to be completely ignored.

Why wouldn't you? Do you never re-watch a film or re-read a book or re-order the same food at a restaurant, or re-drive the same route to work?

I often watch the same video that I've already watched, many times music, many times comedy, many times something I want to link to another person but end up watching some/all again as I find it, often if I remember it being interesting (e.g. a VSauce video or a Dan Gilbert TED talk), sometimes if it was a guide or howto that I want to follow - e.g. a cooking instruction.

Music is probably the main driver, but I've definitely clicked some recommended videos from a channel I'm subscribed to with infrequent long uploads.