It's not the worst strategy (and is actually referred to as 'peppering' your password)... but if your primary use-case is websites and mobile apps, using a password manager like Bitwarden and randomly generated strong passwords is still a better strategy (and probably faster too, since you don't need to type it out manually anymore, and/or remember which flex you used when creating your 'peppered' password).
This is a good approach if you have to login to services that aren't via a web browser though - e.g. Remote desktops etc.
I was also on the grandfathered Google Play Music pricing and saw the same email for increasing the cost of the individual sub.
The pricing makes sense in that context, since now the family plan is just barely cheaper than two individual plans (whereas that wasn't the case before).
This'll be a tough call, given I use YTM almost daily, and watch a lot of Youtube besides.