So this may look like I am arguing against you, but I actually have a very similar stance.
Look at it like this:
Nowadays, the ads (and the videos) are targeted. Additionally, the algorithms are - no other way to put it - really fucking dumb and are constantly "overcommitting". E.g., I watched a few episodes of a podcast months ago and my YouTube recommendation has been 98% episodes of the same show since then, because the algo registered I spent a disproportionate amount of watch time for those (who knew, podcast episodes are long). Or look at Amazon grouping every single book I read the untranslated English version of in "International Books" because it determined that English ain't my mother tongue. Now I am constantly getting cultural, cosmopolitan and language learning stuff; because I read Ian Banks and software philosophy books.
I am aggressively ad-blocking, but I imagine ads are quite the same and I am sure you can recite similar experiences. Now based on this shitty, bizarro reality I would say that the fear of an ad bubble heavily overlapping with a content bubble (for absurd reasons) is not irrational. It is weird, it is dumb, and we could probably overcome it, but products would be associated with weird/illegal/controversial niches by...association.
This whole situation is a shit cocktail of misguided KPI's, straight up scams, questionable assumptions (we still don't know whether targeted ads do anything), cancel culture, bad software and US censorship (we can show you two passenger planes colliding and 700 people incinerating but we can't show you the pilot going "motherfucker"). But this specific choice, to aggressively ban to avoid bad association, is actually somewhat rational.