The definition of infringement makes no distinction. Among the rights included in copyright law are public performance and duplication. It can be argued that streaming is a public performance and downloading is duplication. It’s not entirely settled yet, because there are some who argue that one or the other is both or that either one could also constitute distribution, which is another exclusive right under copyright law.
However, whether it’s one or the other, it is undisputed that public performance and duplication and distribution are all exclusive rights of the copyright holder and that unless Youtube is the copyright holder in this case, then Youtube can’t grant its user any of those rights.
I don’t think any court is going to accept this analogy, because the user has to be a lot more active – searching for a video, selecting it, hitting play, and sitting and watching it rather than moving on to something else.
It’s not necessarily a terrible argument, but as I mentioned above, since the user plays a much more active role when it comes to Youtube, it’s not a settled issue.
It’s not ridiculous and it can arguably be infringing. You’re making an unauthorized copy or a derivative work of a creative work. That’s an exclusive right of the copyright holder.