In theory. In practice, 2000 $ is pocket change for them.

Yes, certainly, fuck their ads; but that wont restore the degraded resolution now will it.

Do you use VLC to play the downloaded YT videos from yt-dl or is there some method to stream directly from a given YT url with VLC?

Ask someone in the north of finland how hot is “very hot”, and how cold is very cold. Then ask the same in middle Africa. Spoiler: it will vary alot.