Another point is that the algorithm (which decides what videos are shown on the homepage, sidebar recommendations, notifications, etc. and provides the majority of views to videos) essentially ceases to promote at all any video that's not monetized.
Which I think is fair -- after all, I think they're already doing non-monetized creators a favor by footing the entire bandwidth bill, they don't owe them free promotion!
But it obviously puts a limit on what a creator can do about ads if they are actually trying to make money (even if they don't want any Adsense money and only want to do their own in-video sponsors, or heck, even if they're just looking for "exposure"). If they turn off monetization, they'll drop off the face of the Earth, essentially.
Hence why creators care so much about a single demonetized video, basically it means the video goes into a black hole and earns them basically no views. It exists, but it may as well not.