(a) Go all in on monetization (ads, Content Id, Music Key, etc.)
(b) Go all out on monetization (upload videos for free, no other commercial relationship).
They aren't offering this choice because it helps them kill puppies or whatever, but for what should be a blindlingly obvious reason: People who pay money for a service that gets rid of ads on music videos are going to be pretty ticked off if they still see ads on music videos.
You can call this evil, but you should be crystal-clear on what you're saying: Google trying to offer a service that lets people pay to get rid of YouTube ads (something lots of people say they want) is evil.
Personally, I think this isn't good or evil, but an example of the inevitable problems and complications that arise when you try to add subscriptions to a hugely popular ad-supported service with many different stakeholders. I suspect that this sort of thing is an underappreciated reason why Google is hesitant to offer paid subscriptions as an alternative to ads in other contexts.