It distinguishes between the person who uploaded the video and YouTube hosting the video. How YouTube exerts editorial control to promote some videos or delete others is not relevant. This is a good rule. HN couldn’t possibly exist without it.

There’s been a lot of really bad information on 230 from people who ought to know better.

I got mine from the text of the law. It does what you say, and also what I say. I definitely doesn't not distinguish between a publisher and a service provider (host, platform, whatever). It does so explicitly.