I'm no fan of EME but you completely lost me there. GCC has been kept monolithic not for technical reasons, but for fear of modularization leading companies to close source their frontends[1]. This has come up again now that LLVM/Clang is gaining on GCC[2]
The decision to avoid a stable ABI or even API for Linux drivers is again driven by non-technical reasons[3] (Linus actually specifically says the reasons are non-technical).
Whether or not you agree with these reasons, I find it hard to call them any more "technical" than the reasons you ascribe to the "rights holders" (also am I the only one that thinks it's silly that the term these companies prefer to call themselves by feels a lot like "landlords"? Who as we all know are universally loved!).
As far as getting better software, it depends. A lot of free software projects end up just doing what the creators feel is interesting instead of things users actually want (cf. Linux on the desktop). I'm not faulting them for that (it's their project and time after all!) but it does sometimes leave users of free software out in the cold unless they have the skills and time to contribute the features themselves.
[1]: https://gcc.gnu.org/ml/gcc/2000-01/msg00572.html [2]: https://lwn.net/Articles/582242/ [3]: https://lwn.net/1999/0211/a/lt-binary.html
(Hopefully something better than running a fork, but that option is there.)
I think EFF's point is that new browsers wouldn't be able to ship an EME feature without specific approval from the studios... at least that was my reading from previous articles here. I can't find the reference now.
A second look reveals media.eme.enabled in Firefox, so it's already possible to turn it off.
The situation was a lot better when you needed Flash or Silverlight, the browser was not broken by design. And you could run a browser without an encrypted bi-directional channel outside of the user's control. (Which incidentally is the argument with which I got the security section into the EME standard.)
On your argument, that content producers are not stupid. I am not claiming that, but their situation with or without DRM is exactly the same; anybody who wants the movie for free can easily find a torrent, anybody who wants a legal stream pays Netflix. The only reason for DRM is, that they want a answer when their shareholders ask what is done against piracy. That is basically the definition of bullshit, a technical standard with a sole non-technical purpose.
The reason free software is winning (Android has a Linux kernel, OS X is based on a BSD, Apache and Nginx run most of the web, etc.) is that the free software ecosystem is quite resistant against this kind of bullshit. Free software developer do what is technically right most of the time, while proprietary software developers have to deal with that kind of market forces all the time. And because of that, we get better software and at some point the market forces are such, that companies switch to the superior, that is the open, product.