AdGuard Home is only as good as the lists you use…

But I don’t think dns-based blocking is effective at blocking all YouTube ads.

Your best bet is to use apps which actively block ads:

YouTube Vanced for Android Phones,
SmartTubeNext for android-based smart TV boxes (ie. Amazon FireTV), and,
Numerous add-ons for different desktop browsers.

Don’t know of any blockers which stop YouTube ads on Roku, iOS devices (including Apple TV). For those devices the best way is to pay for YouTube Premium.