Or maybe it pops the link out of the browser into a dedicated media player which has decent codec support.
I think this is exactly what it does.
With iDevices no luck with mkv’s if I remember right, but not sure if I have even tested one. Most my files are mp4 x264.
Orion Browser on iOS/iPadOS is compatible with (some, not all) Firefox/Chrome addons. Add SponsorBlock for YouTube, uBlock Origin and Video Background Play Fix from addons.mozilla.org and use the YouTube website as is?
Used to run my own Invidious instance I used with Yattee but it got banned and then for some reason ate shit and died completely.