The lounge suit was not invented as a replacement to formal wear, it was invented to be a downgrade or a neutral fashion for men that was less formal than frock coats, tailcoats and similar items. The so-called 'golden age' of the lounge suit, generally 1919-1953, saw one of the longest periods in Western fashion with relatively little change in style. Much discussion, as I understand, as been had on this topic. The conclusion coming down to, men in this period loved the style of: wide trousers (which became wider and more loose over time), high waisted trousers, wide often peak lapels, wide shoulders with pads, tightened waist lines, and except in summer a series of matching color combos of trousers-jacket-waistcoat. The entire ensemble when put together correctly, conveyed a very strong look that had a wide variety of colors and expressions without being too risky. Furthermore, the look generally with its generous cuts and fit, permitted better movement and portrayed poorer wearers better than otherwise. In older formal or neutral fashions, outfits of the higher class often required many dozens of pieces that often could not be worn outside of a single outfit it was made to accompany. In the case of lounge suits, no special matching shoe, hat/wig, gloves or so forth is required. You only have to follow your fashion sense dress accordingly, which would have been common knowledge considering the priorities of the period in Europe and its derivatives.
The video linked also does not represent the reasons for which the lounge suit was so popular. The fact that no man would purchase a machine-made ready suit until after the 'golden age' of the lounge suit implies that every suit that a man would wear was something crafted by hand possessing cuts and constructions unique to a particular person's body and their tastes. This in brief meant that his illustration of the suit being tight and difficult to operate within, is mostly incorrect. Considering the jacket that he is donning, we cane see plainly that this is the case, it appears a slimmer fit jacket made by machine and without a particular uniqueness to his body form. So, indeed if you wear a lounge suit not made for you, it will generally fit poorly; a lounge suit is not intended to be worn like a pair of gloves or a hat. 'Silly ridges' are not created in suits when one wear a lounge suit more correctly tailored. His does so, as it is in the style format of the last say 10-15 years, that is the sort of cheaply produced slim fit suit. This is not an issue with lounge suits, but with the quality of the production that has indeed declined significantly across the men's fashion assortment. Men typically have less access or knowledge of tailored fashion, as I understand in the western world and as such, have little familiarity with what drew so many men to not changing their styles decade after decade.
In general, the person in the video has placed what seems to be 2 or 3 layers under his jacket and then worn a very tight jacket not constructed for him and then complains about the size being too tight or looking silly. I do think thus, that it is a bad video to put forward as to the negatives of lounge suit design.
That being said, to deny the development of the lounge suit, I am not sure. Perhaps if we have a POD in the 18th century, we can maintain the continuation of certain high court fashion. If this is the case, then less casual styles like the lounge suit, may not be invented. Variations of tailcoats and frock coats remain the norm. Lounge suits in general will be far less common if outfits require dozens of different matching accessories like matching shoes, gloves, wigs, shirts, ribbons, stockings, etc... Lounge suits only require you to wear a vaguely matching hat, black shoes and than put on the already matching suit. No other fashion sense is necessary, making it perfect for the man who is wanting to look distinguished without any fashion sense or eye for color combinations.
