Let's look at the facts: 1998 a law was established that made it illegal (in the US!) to track (more likely 'collect data about') children.
According to WikiPedia, YouTube was founded February 14, 2005; well, well after that law. Even the current owner of YouTube, Google, was founded at least very close to that law becomming effective: September 4, 1998.
Now, let's look at what has gotten Google into hot water with the FTC - who is enforcing that law as it seems: Google is selling ads on YouTube. To "improve" the ads, they keep track of basically everything you ever do with your browser. Either by direct or indirect tracking mechanisms. Look up "content delivery networks", "Google Analytics" and "reCaptcha"... by "providing" these web design fundumentals, Google makes sure that they can follow everybody even if that person is not using Google services. Adding "browsing protection" as a plugin to browsers adds even more control and information. And I do not even want to guess what details Chrome (and derevates) is sending home.
Naturally, the FTC stepped in and said: hey, this is legal for adults but not for kids below 13. Since you tracked them too, you are now up for a fine: x-million dollar. Google wiggled out of that with a settlement that included "no tracking on kid related videos"....
hang on... Google made a mistake and instead of properly fixing it, they delegated the punishment to everybody who is uploading stuff? Sure thing. And to make sure everybody "targets" the right "bad guys", they made sure to mention the FTC in every document about that change. Now there are already petitions going to "make the FTC revert the changes". When actually it's clearly Google's fault. They are manipulative to the highest degree in this case. The petition should say: Force Google to disable tracking of anonymous users and track the known ones based on their profile age. Done. Finished.
There's many features of the platform that the "my content may be interesting to kids" selection disables, that have absolutely nothing to do with trackign/advertisements. Just to make the impact even more painful and throw an even worse light on the FTC.
Also, most people think that selecting "my content is for adults" is the safe option. Nope, in this case it's the one that enables tracking for the video and that can fall back on the creator because Google sidestepped the idea of punishment for their actions.
If it were just for the ads, I would have no problem selecting "I upload kid friendly stuff", becuase I do... but losing the comments and notifications? WTF... seriously... WTF!?! To use these, the other party needs an account and that includes a date of birth, so why not tie that to THEIR side instead of mine???