The decision has been backed by Dudley Council, and the campus will provide nursing and healthcare courses and will be run by the University of Worcester.
The disused Castle Hill theatre has not hosted live entertainment since 1974 but remained as a bingo hall until 2009 before it was closed and fell into disrepair.
Matthew, alongside fellow YouTubers Jordan and Luke, paid a visit to the building last week at around 3am and posted what they found on TheSecretVault.
The 50-year-old told the Express & Star: "I love cinemas, theatres and everything to do with them – and I especially love old cinemas, I used to be a projectionist.
"And I actually thought it was a cinema and someone pointed out it was just a theatre. But it had a very unusual layout from the pictures taken by people, it kind of sloped downhill and went up too.
"It's a very unusual theatre and thought I have to see this with my own eyes, it looked so bizarre. People have said before 'You want to check this place out' and because of the looming demolition, I thought I would check it out before it's gone."
Mr Williams said the interior of the Hippodrome was "quite similar" to old cinemas which have been abandoned, with the buildings falling into disrepair within five years of being abandoned.
And he said there was evidence of vandalism and damage being caused inside – with doors cracked, toilets damaged and graffiti left on the walls, including near where the stage used to be.
"We like looking at anything that's sort of like hidden away from the public's eyes, so we (visit what is) considered it a 'little secret' like hidden or kept away from people," said the 50-year-old, who is originally from Cardiff but now lives in Wiltshire.
"I've been to places you can look past, there's just a door and it leads through to this huge cinema. It's these buildings, in a street, which people miss. It's amazing how you get used to features you drive past every day and people just don't believe they're there."
The YouTuber group ventured opposite the main seating area inside – where the stage used to be – and up another flight of stairs, as they explained it still felt "really solid" – until they came across a "floppy" piece of floor near to the back door of the site.
During their one-hour video they visited the male toilets, with the toilet having been smashed and two of the urinals broken, and passed through a Gala Bingo hygiene station
Mr Williams added: "I think it's always a shame with these old buildings (when they're put forward for demolition), because they have such a character which hearkens back to a bygone age.
"You could have live events there and other musical performances – and it just feels like these buildings go from being a theatre to shutting down, being sold off, becoming a bingo hall or something and then being taken over by a group or a church group who can't do anything. They fall into disrepair and it always seems to be a downward spiral with less money available for it each time.
"I think the fact the stage became issued as another seating area was interesting because it had this 'V-form' and it went down and came up – I've never seen that anywhere before."
Dudley Council's cabinet approved the move to knock down the Hippodrome last year, with the Government choosing not to intervene in the decision, much to the dismay of campaigners.
But campaigners have vowed to seek legal action over a decision to overturn the legal covenant on the site, which prevents it from being used except for housing, leisure or retail purposes.
Mr Williams, who said the YouTube channel has been going for two years, added: "By us going to some of these places sometimes it spreads enough interest, so when people see inside these sites there's a notion they want to do something about it. In Swindon, there was a very small building in disrepair and because of our video people have come together to save it and that's happening right now. And a lot of the time it results in some sort of positive action."
The Hippodrome is set to be replaced by a university-style campus with the help of a £25 million grant from the Government’s Towns Fund, which would see University of Worcester run a nursing college from the site.
The theatre, which was built in 1938 and also hosted Bing Crosby, has been empty ever since 2009 despite efforts to revive it – with council chiefs insisting now was the time to act over it.