Here are the quality setting on YouTube Music according to Google:

     Low

        Uses the least storage on your device

        Bitrate: 48 kbps AAC and OPUS

    Normal

        Default setting

        Bitrate: 128 kbps AAC and OPUS

    High

        Higher-quality audio will use more storage on your device

        Bitrate: 256 kbps AAC and OPUS

Seems like it is automatically set to normal on WiFi and Mobile Data. It also seems like there is another option for streaming labeled "Always High" which forces 256 kbps stream over bad connection.

I typically only use Youtube Music for discovery then buy albums that I like (or rip them if they're not available for purchase). I, personally, have never experienced low quality audio on YT Music.