YouTube is not a charity dedicated to children's entertainment. They are a division of a publicly traded company with a legal responsibility to make money. If they want to add G+ sharing and ads in order to remain a viable business, that is their prerogative.
Maybe somebody else will make the app you want, with nothing but an endless selection of free content. Maybe everybody will love it. And then, it'll go broke or get acquired and we'll have to see a repeat of all the "don't be a free user" rants that show up on hacker news every time a beloved company wih no business model either dies or tries to start supporting itself.
Customers are not responsible for keeping companies in business.
They're also allowed to gripe about businesses who fail to accomodate their needs, especially when companies use the "first one is free" model to gain users and then suckify their product to make money (a process I dub "zyngafication".)
OP seeks a model which already exists. The PBSkids.app is extremely kid friendly, albeit with limited content. My Netflix queue is also loaded up with kid-friendly content with zero ads.
Actually, an ad-free kidzone would be a good move for youtube: parents love trusted brands, and brand loyalty starts young (want proof? What toothpaste was in your bathroom when you were a child? What laundry soap? What brand of cola? I'll bet that one of those three brands are in your house right now.)
Furthermore, your PBS example doesn't count: PBS is not a company, they're a non-profit that survives off donations and government funding. If you like their app, you should really consider making a donation.
PBS is a corporation. Just because a corporation is non-profit does not mean it doesn't count. See also: Wikipedia.
Regarding donations: I didn't say content should be free. My second example was Netflix after all. I said that having ad-free on-line children's programming is possible technically and economically.
Maybe somebody else will make the app you want, with nothing but an endless selection of free content. Maybe everybody will love it. And then, it'll go broke or get acquired and we'll have to see a repeat of all the "don't be a free user" rants that show up on hacker news every time a beloved company wih no business model either dies or tries to start supporting itself.