Ads reduce engagement, increase info fatigue, and drive users offsite. Therefore only undesirable users should see them.
A blog is for attracting strangers enough to sign up for your email list. This should be a gradual process. Substack uses the immediate maximum hard sell, which is the wrong approach. It's desperate and disrespectful.
The email list is where upgrading a prospect to a first sale should occur. Asking for a subscription at email collection time is too much. An email list is great at spaced repetition, which is how to indoctrinate a prospect into a dedicated customer. It continues to be useful after conversion, of course.
The point of a blog is to be public. They aren't designed for private membership. Other formats do that better: forums, e-learning, etc.
Ebooks specializes in delivering a long linear info sequence. E-learning teaches more complex content to a higher degree of mastery. Forums enable collaboration and benefit from an ads/premium dichotomy.
Substack is lazy marketing for writers who don't want to use a blog and an email list for their respective purposes. It damages the relationship with the audience in exchange for a quick payoff, while limiting long term audience growth by ruining one's organic web presence.
The main benefit of Substack is that it enables a writer to monetize without thinking about it. It's the equivalent of banner ads, back when those were meaningful for bloggers.
A blog, like a book, pays in status, access and trust, not in money. Converting directly to money at such an unfavorable ratio is a terrible waste. Instead, one should monetize in a way that increases one's status, access and trust. Which one can accomplish by monetizing mediums that are meant to be premium.
Moreover, not paywalling blog posts means they don't need to be updated. This better fits the nature of SEO and of blog posts, which usually lack git VC.