The files are recorded USING NVENC in the first place.
Right, but they're recorded from raw RGB. You lose quality on the initial recording, as NVENC is highly lossy, and you lose quality again on the re-encode, and then you'll lose quality a third time on the final post-edit encode, and then again when youtube processes it. Ideally, you want to minimize the number of times you re-encode to highly lossy codecs like that wherever possible. You can do it, and it will work, but just know you do lose quality.
While there's technically a theoretical loss of quality on ProRes, it's a production quality codec, meaning it's used for things like post production because you can actually encode it multiple times without any visible loss of quality, at least to the human eye. That's why it ends up making such large files of course, but still.