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It's still mandatory for all but the newest iOS devices, which don't support MediaSourceExtensions.

This is true, and the whole iOS/iPadOS/tvOS ecosystem supports HLS natively making it much easier to work with on that platform. In addition, Chrome recently added support for HLS[1] (and not DASH), so the native browser support for HLS is getting pretty wide.

HLS also has newer features that address the growing manifest issues you were seeing. [2]

All that said, I think a lot of people would feel more comfortable if the industry's adaptive streaming standard wasn't completely controlled by Apple.

[1] https://caniuse.com/http-live-streaming

[2] https://www.mux.com/blog/low-latency-hls-part-2

How do you actually use HLS in the form of a native browser feature? Can you just put the m3u8 in the video src?

Yes, doing that works perfectly. If you use videojs it will automatically use native support if present.

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