The iframe embed API is API access, and YouTube can remove, paywall, or rate limit it any time they want. How old the underlying technology is is completely irrelevant to that.
The YouTube embed API supports ads, and works perfectly with Premium so Google are not losing any potential revenue with this app existing.
Sounds like Christian learned his lesson with his experience with Reddit: "don't get in the way of the company's ad revenue".
Your statement still stands though, you are ultimately correct.