Taltessy The reason why ads are not being blocked by DNS ad-blocking is because they originate from the same URL as YouTube itself. If they tried to block the ads, they'd block the videos too.
For a YouTube app, I would recommend LibreTube. I've been testing it out recently and it keeps improving with each release. No ads, and yes, it does allow you to look at replies to comments.
I personally do not trust Vanced, and I'm not really happy with NewPipe because it seems to lag behind in terms of keeping up with best practices (older SDK etc.)
Another option you have is using a browser like Brave with the regular YouTube site. It will block apps, and it has a setting to enable background play, if that's something you need. They do say it's "experimental", however. I tried it out a few days ago and it worked fine.
Lastly, if you want to use Vanadium, there are projects like Invidous and Piped which are alternative YouTube frontends. Neither have ads by default.