Again, this can only really put Yu out of commission if Steve immediately opens with lava. If he does anything else, and if it manages to hit Yu, Yu will immediately know Steve's range and how to avoid it—he's better at coordinates than Jean Pierre, who can accurately determine the distance between him and opponents to to 33 feet (11 yards away), so Yu will constantly be aware of the distance between him and Steve and how to move around it.
What I'm getting at is that it doesn't matter if Steve opens with lava/water or not, the first time he uses that, Yu will have no idea what is coming. So it is the equivalent of it being his "first move."
Reason being:
1. Lava/water placements have longer reach than his physicals. If Yu misjudges that Steve has 3 meter reach, then he'll be unprepared for the 4.5 meter reach of lava/water.
2. Yu does not know Steve has lava/water in his inventory until he pulls it out.
3. Yu has no reason to assume that Steve can use a small bucket of lava/water to instantly spawn a cubic meter of the stuff on his current position.
Regardless of whether its his first move or not, Yu isn't going to be capable of predicting such a thing. The physics of it are much, much different than his reality.
Yu can actively keep track of his coordinates in relation to others, so if Steve opens up with punching him or trying to place water, then Yu will immediately figure out the range of Steve's attacks and be able to avoid them.
Two different types of range he has to figure out.
the 3 meter physicals and the 4.5 meter block interaction.
it is entirely possible he only figures out the 3 meter physicals and doesn't know the 4.5 meter range until its too late.
This also doesn't consider that water and lava have to spread out from where Steve places them, and Yu is seeing both Steve and anything he does at significantly slowed speeds, so even if he's caught off guard, Yu will still comparatively have a lot more time to dodge than Steve will have to attack. Unless Steve can literally place things overlapping Yu, he will have time to dodge.
The spread doesn't exactly matter. It is the cubic meter spawn-on that matters. It's effectively a small-range AoE attack. Because Yu is so grounded as a character it is a very powerful move to use though.
Placement speed is also practically instantaneous. There's not much time to "dodge." It just happens.
Yu can, again, just go around this using monster stance spam, which also continuously gets faster. The water takes time to fully fall down and spread to begin with, so Yu has plenty of time to slip past whatever water structures that Steve makes, especially with his acrobatics which allow him to maneuver in ways that would let him slip through tight gaps quicker. Steve also can't place water or lava just in mid-air, he has to place it on or around Something for it to form some kind of structure that could block Yu, which gives Yu even more time to attack.
I'm saying that Steve can hide in these water pillars, where Yu is unable to reach him. He could make like 10 meters of water spread and just stay in the middle of that. Where Yu is forced to enter water in order to get into range.
Range is a massive issue for Yu in this fight.
The attacks don't spawn on though.
Lava/water do spawn-on.
Steve can only place blocks or stuff around a person, he can't place things on mid-air, he needs a surface to anchor it to. This means that there will always be a minute distance for him to dodge, which is all he needs to easily avoid any attacks once he figures out Steve's effective range. A cubic meter is something Yu could easily side-step while losing no momentum.
Blocks can be used to control Yu's movements to an extent, while also making barriers.
I also haven't mentioned that Steve does have a shield in his off-hand. While Steve is unable to attack and defend at once, if he has a shield active, then he effectively gets like 7-C durability against attacks that hit it.