I built Phosphene to sell it, but the existing competitors were polished enough that the time it would have taken to catch up wasn't going to pay off. So I'm open-sourcing it.
WallpaperExtensionKit.framework is what powers macOS wallpapers. It controls what’s shows in the Settings app. It took a lot of trial and error to replicate the behavior, but the result is that your custom wallpapers appear alongside everything else. I wanted to have an “add” button there too, but I couldn’t find a way to do so, so there’s a companion app that will put your video where it needs to be.
Unlike Apple's Aerials, the video keeps playing on the desktop (not just the lock screen). The renderer drives AVSampleBufferDisplayLayer directly with PTS-offset gapless looping, and pauses or downshifts based on thermal state, battery level, brightness, and window occlusion.
It’s free and works well.
However, it may definitely get broken by Apple, as you note.
I won't use it, myself, because I can't deal with wallpaper moving behind my work (I also can't listen to music, while I work. Maybe it's a "generational" thing). Also, I use a 49-inch ultrawide, so it might be vomit-inducing.
I remember some other utility that played wallpaper videos, but it wasn't anywhere near as nicely done.