Kyc is always an issue for gamblers who often play online casino games, there are some gamblers who sometimes think that they are very worried when kyc is asked of them, it is too big a deal on their part.
KCY is actually a common issue. It is not so different with CEX, casino sites also may ask for KYC. It is probably intended to ensure the activity done by the user himself. It is the way to avoid suspicious activity like fraud, hacking, or etc. As long as it is a standard KYC, I think it won't be a big deal for anyone.
It should have been from the beginning because if they didn't want it like this, they wouldn't have played at the casino anymore, but that's not what they did, they just continued to play instead of just complying since the casino is also regulated.
Each gambler must read TOS first. This is needed to avoid possible problem in the future. If they don't want to do KYC, they can choose casinos with a free KYC. However, I assume most casinos will apply KYC as one of the requirement to use their service. CMIIW