This method can make money (not major cash but, for a noob, a nice additional income stream to add to the arsenal). However, some noobs will do better than others. There are a few prerequisites for doing this right...
1) If you're an expert on a specific genre of music like House, Blues, Country, etc. and you know when the hot new releases will be available...and, assuming you can be first with the new track, you'll see a mass rush of downloads before you'll be issued a cease and desist by the label.
2) Mass, mass uploads. Essentially, this is just throwing
everything at the wall and hoping a few stick. If you can download everything on your country's top 40 list, for example, and make videos for each, you're bound to have something take off. Again, expect a cease and desist if it gets too big and some of your videos will be blocked in some countries. The record labels aren't
completely retarded...but you can game the system if you time it right.
3) Make decent videos and do your research. You're wasting your time uploading videos for songs that already have a slew of lyric videos and such. You'll never out-rank most of them
unless you make good looking videos and you're first on the block. This will require a lot of leg work on your part.
So...all of the above for about 30 or 60 dollars per month. Is it worth it? That's up to you. As I've written previously, everything you do in IM can teach you a lesson. If you're a noob, you'll take something away from this so it can't be all bad.
One other thing...as far as your accounts being banned, you'd really have to take your eye off the ball for this to happen. YT has better things to do than monitor every video you upload. They already have copyright infringement policies on auto-pilot (some of your videos won't even make the cut; know that going in). They don't check every video uploaded beyond that. Mostly, the artist or the label will have to report you - and most will reach out to you personally before they do. When this happens, just remove the video and keep your account. Move on.
Especially for new artists, a lot of people in the business are going to look at your free promotion as a bonus, at least at the onset. Kelly Clarkson and Justin Beiber will block your shit immediately. They don't need your "help". Bob's Crap-Ass Garage Band will probably let you slide until they make the Top 40. The label will make most of the money off of a new band's releases; the band will make most of their money from touring (and will get paid more if their song is popular, so your video might actually assist if it's any good).
And, finally, a guilt trip: as some of you know I work in the music business. Most of these new artists don't make shit. Doing this, you're taking money out of their pockets. Yes, yes...I know that this is BHW and we do all kinds of shady stuff here. But, I can tell you from personal experience that the first time you get a WTF email from an artist, you're gonna feel a little bad about it (even if you only made a few cents off the download - they could have made a dollar). Most indie bands can't afford to tour, so be mindful of that; they're going to make most of their cash from selling their songs. Still, money is money and you gotta ask - would they do the same to you if given a chance? Maybe. I guess all I'm saying is if they ask you to take it down - do. Don't be a dick.