Experiments sometimes go on for extended periods of time, some times they become permanent features. I don’t know the current status of the Purple Screen of Death other than that yes it’s still a thing if you use embeds.
I don’t know for certain why Embeds don’t run ads, but I expect it’s because Twitch can’t control the content of the site in which they are placed, and some ad providers may have specific requirements on where an ad can or can’t be displayed. For example a company may not want a family friendly product being advertised on a porn site just because it has a Twitch embed.
As such if you don’t want to see the PSoD, you should watch on the Twitch site. If you still get the PSoD while on twitch.tv it’s likely because of a browser extension you use to block ads.