To answer your questions - users such as this bring something more valuable than ad money. They bring data. Google harvests data and metrics on users in a million ways, packages this up, and sells it for considerably more than they make on ads. In free services such as this, YOU are the product.
Ads suck, nobody wants to watch them, and they simply represent google maximizing shareholder value at every opportunity, as they are legally bound to do under American capitalism. YouTube ads are not a critical revenue stream that will make or break them.