I’m not sure what you mean about no option to select an instance. Here is an example instance with open signups: https://libre.video. You can find more here: https://the-federation.info/platform/29

Youtubers could gradually switch to PeerTube by uploading videos to both sites for now. They would make money the same way they do currently - through sponsorships and donations. I’m sure many of them can afford to host their own instance. It would actually benefit them, because if YouTube suddenly bans them for some reason, they would have an alternative that their fans would know about.