Why does it need to run remotely hosted code though?
Privacy
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Because the ads constantly change across the websites. Adblocking is naturally a cat-and-mouse dynamic. However, the "remotely hosted code" Adblockers use is not exactly "code" (as in a JavaScript code, for example), it's more a Regex code containing patterns for the different websites and different behaviors (for example, the pattern for the pesky HTML element containing the ad, or the pattern for some ad-serving domain). Google is extrapolating their meaning of "remotely hosted code" purposely, so they can "justify" their measures.
Honestly, I blame developers who, some years ago, decided it was a good idea to centralize the browsers into the same engine. Yeah, it was hellish to maintain code for all browsers at the time (IE5, IE6, Firefox, Safari, etc), but it was paradise compared to our current scenario: at least we really had options: WebKit, Trident, Gecko, as well as lots of smaller, almost unknown engines. Now, all modern browsers are different wrappings of Chromium or Firefox, while most modern sites are developed without the active worry to keep Firefox compatible (one can notice how modern HTML5 features varies across both of them). It has no easy solution. Don't update, maybe? (Until sites start to complain about the outdated version)
Google pulls the plug on uBlock Origin
No they don't. And can't. It's not their product.
Headlines these days. Are they all complete lies?