>YouTube dictates to advertisers how things work, and not the other way around.
They could but if you look at 2017, the stuff YouTube got in trouble from advertiser for is the stuff they got in trouble for from large segments of the public or the media. YouTube doesn't want to take a stand forcing advertisers to accept PewDiePie's Hitler jokes, some guy making fun of feminism, or Logan Paul filming suicide victims. If they do, they'll get destroyed by the media and advertisers will leave anyway.
TV-era cultural mores being applied to the internet seems unlikely to happen, despite Google applying demonetisation rules to anything beyong 'broadcast TV' levels (see the leaked YouTube docs https://imgur.com/gallery/uTLTS ).
Internet culture is taking over the mainstream, demonetisation of edgier content might have a shortterm effect of restricting content, but ultimately, it's unlikely to stop the cultural shift - people want edgier humor, and if it's popular enough it will eventually appear on Twitch, Vimeo or elsewhere.
Brands are happy to be associated with edgy humor if Jimmy Kimmel is producing it: check out the examples on https://www.youtube.com/watch?v=pj8n78AuN3w. They'll soon be comfortable if a YouTube equivalent is doing the same.
Non-edgy content is not going to disappear, heck it might even be quite popular! (See: Hallmark Channel in "traditional TV land", the appeal of things like cute animal videos in "Internet land") Edgy content is nothing new, either, although of course what is "edgy" changes from generation to generation.
Youtube's problem as I see it is differentiation. Howard Stern was "edgy" for his time, similar to how some Youtube producers are "edgy". Yet he has no problem attracting advertisers as far as I know (Googling suggests his radio rates in particular were quite high). But it seems like it was/is much easier in traditional advertising to say "I [do / do not] want to advertise with Howard Stern" then it is to say "I [do / do not] want to advertise with PewDiePie". That's really the crux of the problem as I see it, it flat out sounds like Youtube can't do targeted marketing very well (a ding made more painful considering this is the success story of Google Search). Heck, "I do not want to advertise for ISIS recruitment videos" seemed to be a request Youtube couldn't fulfill for a while.
I don't think "edgy" in itself is a problem to many advertisers per se (except for certain step-over-the-line moments) and I agree with you that Youtube is tackling things in a way too crude manner.
The cultural shift is happening but that doesn't mean the entirety of 4chan lingo is suddenly acceptable now. It merely means someone like Phillip De Franco can get away with opening every video by calling his viewers beautiful bastards.
The examples you list are the few obvious, controversial types. The majority of content creators who have been getting demonetized over the past year or two do not have a single shred of "bad stuff" in their content. There are people losing their entire income because they don't fit some algorithm that has nothing to do with (properly) categorized - or reported - content.
It doesn't help that there are apologizers who spread the idea that YouTube is somehow targeting "the bad stuff", when that is a very small fraction of what is happening. Everyone focuses on the sensationalist garbage reported by the media; meanwhile all the small channels that are playing by the rules are being left out to dry.
They could but if you look at 2017, the stuff YouTube got in trouble from advertiser for is the stuff they got in trouble for from large segments of the public or the media. YouTube doesn't want to take a stand forcing advertisers to accept PewDiePie's Hitler jokes, some guy making fun of feminism, or Logan Paul filming suicide victims. If they do, they'll get destroyed by the media and advertisers will leave anyway.