You're both right from where I'm looking.
I've been saying that DNS is the perfect mechanism to assert NIP-05 identifiers (and Lud-16 lnurls, and even BTC addresses) for quite some time.
In the case of NIP-05/LUD-16 The .well-known/URI scheme is limiting - and I would also argue, less secure than, say, a DNSSEC signed zone.
While true that DNS is "centralized" ultimately at the root level, there is no content or participant level censorship there - the DNS tree is somewhat like a federated namespace AND there will in time be more decentralized namespaces outside of the IANA tree within which one could pin their NIP-05 or LUD-16 ids.
None of these arguments have convinced the people it needs to (*cough* fiatjaf (npub180c…h6w6) *cough*) - and to his counter-points, I do somewhat get it).
It is possible that somebody, someday could propose another NIP entirely for the assertion of NIP-05-like id's (they would look exactly the same) via DNS TXT recs.
It is not obvious or probable that such a NIP proposal would succeed.
At the risk of sounding repetitive, I'll refer to my previous article on this sort of thing here (and there are a few threads on Github somewhere):
https://bitcoinmagazine.com/technical/simplifying-bitcoin-addresses-dns
