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Peertube's moment might come soon
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Not unpopular with me at all, my wife also prefers regular YouTube because the video quality tends to be better. YouTube just handles variable connection speeds better, and the buffering and quality switching is very smart. I mostly agree, the watching experience is superior.
But YouTube ads are among the highest annoyances of my daily life right now, they simply could not be less relevant for me. Because I'm in NA it's adamant that I buy an EV or an SUV, a bunch of fast food ads, it's just too much. I'm willing to spend 20 seconds waiting for Piped to buffer instead of 8 seconds of YouTube ads.
And I'm not really hoping Piped will ever go mainstream, because as you said, if that happens they're toast. Piped and Invidious have to stay niche to keep flying under the radar - well not really under the radar, YouTube already sent a Cease and Desist to Invidious, but I guess for now they're not invested in enforcing it yet.