That's not my take on the requirement that one have ancestral DNA
Furthermore, the official definition is not phrased in terms of DNA, only descent. Many Indigenous communities object to the use of DNA testing in determining Indigenous status, and as a result it is mostly not considered in deciding these questions.
The official definition is ambiguous in using the word "descent" – while most commonly that is interpreted as "biological descent", it isn't clear that merely legal descent (as in legal adoption) is actually excluded. If an Indigenous person legally adopts a biologically non-Indigenous child (or has such a child through IVF, surrogacy, sperm/egg/embryo donation, etc), and the child is raised to identify as Indigenous, and their Indigenous community accepts that child as Indigenous – there is an argument they officially are Indigenous, and given the unresolved ambiguity in the official definition, I don't know how one can say that argument is incorrect. In practice, if the elders of their Indigenous community write a letter declaring them to be Indigenous, the government will very likely accept them (and their descendants) as such.
It also potentially results in two groups of Indigenous people – one group with majority Indigenous ancestry, found mostly in remote/regional/rural, who experience a great deal of social deprivation; another group with only slight Indigenous ancestry, found mostly in urban/suburban areas, who experience very little social deprivation. With all this talk of "closing the gap", counting both groups as "Indigenous" makes "the gap" seem smaller than it actually is, and if the second group is growing, that growth can create a false sense of progress of the gap being closed, even as little or nothing improves for the first group.