It means just because some use-case could be solved with proof of work, it doesen't mean you should expand the bitcoin protocol to include that use-case such as DNS. It's because they are separate applications; DNS is a data service, bitcoin is a hard asset. He isn't saying you shouldn't buy domains with bitcoin. He also is essentially saying NFTs shouldn't be recorded on the bitcoin blockchain itself such as storing an image or a movie in a block. If you want to make your own POW based storage service, fine, but don't try to shoehorn it into a monetary asset because they have very different requirements and design constraints.