I think Space Invaders actually is most known and played on the 2600, at least in the US. It didn't quite have the same reach in arcades outside of Japan, compared to the biggest titles like Missile Command, Galaga, [Ms.] Pac-man. It was the big system-selling killer app for the 2600 before Pac-man came out.
Space Invaders was by far the most played cart on my 2600. It was so faithful to the original arcade game and the difficulty ratcheted up just right.
I hadn't seen your version until now (wow!) but it does a great job of contrasting the trades that the designers of these games had to make when the resources they had to work with were so limited: here, a lot more invaders vs. substantially less resolution on each.
The tell for me is that when asked to describe the first/preferred version they played, most people will eventually mention multicolored invaders. So either they're falsely projecting today's images back (possible but I think unlikely if they don't regularly see it still today) or they're remembering an arcade version with an overlay.
This may be true, but think about Asteroids, which is the converse. Most people will also mention multicolored asteroids, which was true on the 2600 but not the arcade. They will remember whichever version is more vivid, even if it wasn't what they experienced more.
Right. For decades I thought I had played Space Invaders on the Arcade machine while I discovered later it was Space Invaders Part II (Taito). Also, with a similar color palette, Space Panic.
I wrote a more arcade-accurate Space Invaders port for the 2600 (in 1997, when homebrew games were getting started): https://atariage.com/store/index.php?l=product_detail&p=283