Can you really make that strong of an argument that YouTube's player is "overengineered"? I'm not always a fan of how they handle things but you have to at least consider the massive scale they are working at.
Since he was talking about slow connections, and I have seen YouTube issues on slow connections, here are two main issues:
1. The bandwidth switching is really messed up. When I'm playing something and it has buffered, let's say another 10 seconds and then quality of connection goes down, player will not switch quality after playing those 10 buffered settings. Instead, it discards all buffered data and fetches lower quality video again.
2. On iOS, video just gets stuck on low resolution. Picture will freeze, audio may stop or keep going and position indicator loops between 4-5 second interval. It will move forward 5 seconds, move back to the point it froze, repeat.
Think about the opposite use case, you're watching in low quality and decide to switch it to higher, the buffered video is all not what the user wants.
