You have to use a relief cut to thread from the shoulder because you have to be able to put your tool in the starting position. Now you can make it smaller or even make it the same size and shape as the tool bit. Pull the bit into the work and engage the half nut. He used a huge relief cut, much more than required. Like I say, you tube videos for demonstration take some liberties.
The big deal with a relief cut is that not using one is an advanced technique so people like to be able to say they don't need one. Eric pointed out that if you want to set your barrel back a half inch and not cut off the tenon, you can pick the thread up (another advanced technique) and continue it. With a relief cut, you'd lose the threads where the relief cut is. I recently set a barrel back 1" by cutting it off at the point where the relief cut was...didn't help to set it back, it still shot like crap....
The relief cut, if it is the same depth as the root of the threads, does not weaken the joint, in fact, it might make it better if it give the tenon a bit of stretch (on the order of .0001 inch). When you torque a joint, you are stretching the material. A joint up against a 1/4" lug only has 1/4" to stretch and it is approximately the major diameter. No stretching really available to maintain tightness. So the strain takes place in the threads. It obviously works but isn't optimal joint design. For example, the 8" diameter studs that hold the head on the reactor vesssel of a nuclear power plant are 5' long and stretch about .025".
--Jerry