That file is a playlist format, and contains links, no content itself. The links are to places where the stream is legally made available. Main difference is the tracking embedded in the site/app via which the MPA would like you to view the content.
Not sure why Github caved - doesn't seem reasonably needed on the face of it...
Because the US DMCA gives them little choice otherwise. If they receive a DMCA request that looks real [1], the DMCA leaves little room for the site to do anything other than take down the content. The content owner would need to file a DMCA counter claim (which is part of the DMCA process) after-which Github can legally restore the content without also taking on possible copyright liability.
[1] and a DMCA from the MPA will likely look very real and properly correct on its face.
how difficult is it to make a counter-claim in cases like these (which, i think, is a legitimate counter-claim)?
And we don't know what is in the mind of the repo owner, so we have no idea why no counter has been filed.
The DMCA is a very flawed law that is easy to abuse and isn't even effective at stopping actual copyright infringement from being rampant on the internet.
My understanding is that you can sue for damages if somebody makes a fraudulent DMCA claim but that's not a sufficient deterrent because lawsuits are expensive and often the damages are small or non-existent. For example, it almost certainly wouldn't be worth it for the owner of this repo to sue the MPA (if an actual attorney disagrees, then I defer to their opinion).
For the MPA, this DMCA is all upside and no risk even though it seems legally dubious. For the repo owner, a counter-claim is a self-doxx that opens up the risk of being sued by the MPA (if they think it's actually worth suing over) for very little upside. Which is why this is such a good example of why the DMCA is a bad law.
Can this be a business?
It makes the most business sense to just follow the process in most cases, IMHO; but they can take a risk if they want.
Never mind the massive Lazy Susan Scheme of unicast cloud bandwidth, collusion, and Berkshire Hathaway's money this whole activity entails.
[1] Now disabled: https://github.com/iptv-org/iptv