> I also wonder if the rise of the "this video is sponsored by xyz" segments in people's videos have cause more harm. That ad money that is circumventing Youtube entirely, paid directly to the content producer. So Youtube might be "jealous" of this revenue and wants to encourage its content producers to let them run ads only?

I think this is exactly right, but what's missing from the story is that YouTube created this problem. I'm mostly on educational YouTube, and in that sector creators turned to sponsorships because the alternative was to constantly wonder whether your next video would be demonetized and lose out on all the revenue (while still showing ads on the videos!) Sponsorships are a much more predictable revenue stream.

If YouTube wanted to support creators better, they wouldn't do it by adding more and more ads (to the point where my wife is finally approaching me to ask about ad block), they would do it by actually addressing creator concerns about reliability of their revenue streams.