There's an awful lot of information there, but two bits of info that were striking to me:
"If you sign a traditional deal with a Big Six house, you’ll receive an advance. But most authors (up to 80%) never see royalties; their books never earn out." I was aware that it was not at all unusual, and maybe even common, for writers to never make more on a book than their original advance. But for this to be happening with "up to 80%" (what does "up to" mean?) of writers is significant.
" It boils down to three desirables that publishers offer.
I think the major desirable publishers offer is service. Yeah, yeah, yeah, I know that marketing and promotion are the big devils on everybody's backs. But publishers also offer editing. I do not mean copy editing, though they do offer that (mine always did) and that is definitely important. But more significantly, they offer content editing. This is crucial. It is a rare manuscript that will not benefit from a second mind helping to look for inconsistencies, meanderings, unnecessary characters, and a long list of other things.
At a publishing house, your manuscript was acquired by an editor who has some kind of interest in it, presumably "gets" it and "gets" you, at least in relationship to this one particular piece of work. Because they are being paid by a third party (the publisher, not you) they they are free to go back and forth with you to help you shape your book into something more polished and finished than your (first) final draft.
The money might not be great with a traditional publishing company and your neighbors and family may be totally unaware of your elevated status because you're publishing with one. But so long as the traditional publishing companies have content editors, they'll have one very big desirable to offer.