I've always thought that just as a matter of "manners" one should attempt to use as little of a limited resource as possible - especially when using perhaps internet or worse, cellular data or radio spectrum.
Back when Google did the whole "we will set the default resolution lower" thing at the beginning of the pandemic, were YouTube users en masse pissed off at the lower quality, or did they even notice? I would argue that most people would not be scrutinizing the video, especially if they were not full screened, at which point the resolution may as well be wasted.
I'm not necessarily defending paywalling the feature, but I do think there is validity into pushing users into a lower qulity funnel for reasons beyond simple greed.
On the other hand, I watch most of the videos I watch in windowed theater mode in 1440p on my 4K screen. I find that 1440p is the best quality that does not cause frequent seeking in the video to lag, and I tend to do this a lot to skip for example, sponsor segments and other "fluff” manually. I'm on fiber internet, so it's probably got something to do with either YouTube or my computer's video decode pipeline