Great post overall and I recognize a lot of the concepts from my school-time and you explained it well.
I can't speak much to game development beyond some smaller experiments with modding etc. However I can't help but notice that even if Ubisoft has a shitty track record of toxic assholes they sure do seem to have planning figured out pretty well for Assassin's Creed and soforth. Too bad that I have zero interest for their games except Beyond Good and Evil 2 but we don't talk about that game.
Obsidian actually seems to have learnt some lessons from their troubled history and Outer Worlds (though restricted in scope) on a new engine was impressive in the timeframe they made it. Haven't heard much regarding the quality of the DLC but I thought the base game was quite good.
Development is complicated in that it's not only cognitively taxing but also increasingly requires a team effort from several skillsets. However if you hit a consistent groove it can be creatively fulfilling so I understand why you might be enticed into spending free time on it but ultimately you will probably get exploited. Game development might not even have the option for end-to-end automated testing so Q&A must be a pain.
That's as much as I'm comfortable speaking to game development so the following is mostly me talking out of my ass about software development in general so YMMV.
I do agree that volunteering overtime is counterproductive in the long run and I try to address it as something only done for drastic necessity (or if I have an extreme interest in pushing an improvement) but I've probably hit the tipping point of punching in and out strictly for the hours paid, deadlines be damned. Paid Time Off is equally if not more important to me and I think unions (that I support and have had benefit of in my country) are good for pressuring for that but I'm not sure collective bargaining is realistic in the current landscape of projects and consultants. With time it might change though.
Personally I have never done anything productive for more than 50 hours a week and that's stretching it so when people describe going beyond that I guess they are counting at least 20% "water cooler talk". Unfortunately technology waits for noone and keeping up with frameworks, languages etc. might require at least some personal interest on the level of a hobby but I might be lucky that I find some enjoyment in it.
Ultimately I hope improved education beyond hardcore STEM subjects can help the aspirants being cycled in to understand the processes and pitfalls of software development (e.g. methodologies like waterfall, prototyping, agile) and give them the resources for planning consistently. Some of the subjects were abstract mumbo-jumbo to me in school but I'm quite glad I learned it because it seems like most of my current and previous colleagues are oblivious to it (to the detriment of work/life balance and deadline accountability that I have burned myself on as well).
EDIT: Also I'd suggest finding a better word than crunch because management is not "crunching" more work in to less time spent but in fact expanding/dilating work into more actual time spent within a shorter timespan with both short and long-term repercussions.
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