YT does not (currently) show ads for those. Also you can switch between videos more readily, if you don’t really care about what you are watching and just want to be “entertained” (like a toddler) for 1-3 minutes.
And from YT’s standpoint, it boosts their traffic stats, while sucking in the Gen-Z watchers, who until it becomes enshittified can make great use of it.
Fwiw both PieFed and the Tesseract front-end for Lemmy have YouTube embedding. And probably some apps too but I don’t know which ones. This is the real dream: you don’t even leave the post to watch it, if you want, and the preview pic is just already right there.