It is but there’s just not enough content to get me to fully stop YouTube yet
I don't think anyone is proposing an overnight switch. You've got to take the long view. That said, I do think when it comes to federated activity pub style projects, Mastodon has gotten off the ground, Lemmy has exploded, pixel-fed seems to be doing pretty good, but the video stuff appears to be a tougher nut to crack.
Exactly. For any proposed change, it's going to run up against what I like to call Status Quo Extremism, which is a mindset that suggests that "But that would be different from the status quo" counts as a defeater argument against proposed changes.
The combination of incentives would, as you note, need to be driven by niche interests rather than attempting to reproduce the incentives of the top 0.01% of YouTube creators.