From what I gathered now, the motivation to do it was only possible in the "special" management structure of VW under Martin Winterkorn. Apparently he created an atmosphere where everyone was afraid to contradict decisions from above and where objections were not welcomed. Winterkorn himself was known to carpet people personally when he didn't like something they did. He basically was a dictator, nobody dared contradicting him and everyone was afraid of giving him bad news.
So in this atmosphere it was possible that the engineers under him rather resorted to installing a fraudulent software than having to confront him with the fact that a technical sollution was possible but expensive and intricate. In fact, I really think Winterkorn didn't know about the software (or didn't want to know), all he needed was the assurance of his subordinates that the problem was solved. Didn't matter how.
Only with this kind of special atmosphere of fear, where everyone was afraid of risking their career when they said something wrong, was it possible in my opinion, that such highly skilled engineers and managers didn't wonder why the difficult problem with cleaning the diesel was solved so easily. And I suppose nobody dared digging deeper, because they'd had to report it and probably would have gotten heavily berated.
I think Winterkorn suffered from "Cesar Delusion" and didn't help that in contrast to other car makers VW isn't exactly a paragon of transparency to outsiders and shareholders. Everyone around him told him again and again that everything was fine and that there were no problems, only to keep his favour. It's what happens in dictatorships - until things have become really messed up and a cleansing revolution takes place.
And that has what to do with the fact that I don't see black smoke coming out of diesels these days? You made the assertion that decreasing NOx emissions increases black smoke and particulates, yet I do not see diesels rolling coal in my daily driving/walking since those diesels clearly meet current emission standards your assertion holds as much water as a rusted collander.
Let me ask you a simple question: Do you deny that diesel exhaust fumes contain other potentially dangerous substances than NOx?
Do you really think NOx is the only dangerous element here? It's as he said in the YouTube video: Partical filters more or less killed off the smoke in modern diesels but that doesn't mean it's not there anymore. Maybe not so much in America but here you see (and smell) those old smoking, stinking diesels every day. In order to filter the tiny particles the smoke consists of, you automatically raise the amount of NOx the engine emits, hence the necessity of the urea injection to counteract that. Getting a diesel clean, is a bit like trying to nail Jell-O to a wall. I don't think that is too difficult to understand.
What VW did, was fraud. It was a criminal act. But it cannot cover up the fact that basically every diesel engine in the world (as well as every petrol engine) emits substances that are dangerous to our health. So the major fact that people might have problem with asthma because of exhausts, is not because VW cheated on one of their engines - but that engines-in-itself exist in the first place.
Technical progress doesn't come without a price. We pay that price every day by breathing in the exhausts. And all of us, you, me, everyone adds to it by creating more exhaust every single hour of every single day...
In other parts of the world there is slave labor and child labor because people in the First World like to have smartphones and cheap clothing. Our world isn't perfect but sueing VW because they intoxicated your granddaughter is about as logical as sueing the ozone hole for giving you skin cancer.
If you want clean air, you have to go back before the industrial revolution. But then you would have probably died of some disease doctors couldn't treat back then