My mother also got the smallpox vaccine and had a permanent scar from it. I pointed it out as a small child and she told me about it, I asked my dad and he had one too. I thought it was cool, like a rite of passage where one day I'd be old enough to get my own permanent vaccine scar. But then they had to go and eradicate smallpox, saving countless lives. Bummer, dude.
Watch history is an absolutely essential metric for Youtube - I can understand how you've been led to believe that turning this option off is opting out from that data collection, but no. What this setting is asking is if you want the data collected to be represented to you as recommendations for other videos to watch. It absolutely doesn't change what data is collected, just whether the videos you've watched should be accounted for when the algorithm is finding new videos to recommend.