The claim:
$$\hat{\beta} = (X^TX)^{-1}X^Ty = (L^TL)^{-1}L^Ty$$
We have that both $X$ and $L$ are concatenations of a column of ones and the rest of the predictors:
\begin{cases}
X=\matrix{[\mathbf {1}_n & X^*]}\\
L=\matrix{[\mathbf {1}_n & L^*]}
\end{cases}
$L^*$ is given in terms of $X^*$:
$$L^*=X^*-\frac{\mathbf {1_n1_n}^T}{n} X^*=\overbrace{\left(\mathbb I_n - \frac{\mathbf {1_n1_n}^T}{n}\right)}^CX^*=CX^*$$
So
$$L=\matrix{[\mathbf {1}_n & CX^*]}$$
$$
(L^TL)^{-1}=
\left(\matrix{\left[\matrix{\mathbf {1}_n^T \\ X^{*T}C}\right]}\matrix{[\mathbf {1}_n & CX^*]}\right)^{-1}\\
=\left(\matrix{
\mathbf {1}_n^T\mathbf {1}_n & \mathbf {1}_n^TCX^*\\
X^{*T}C\mathbf {1}_n & X^{*T}C^2X^*}\right)^{-1}
$$
Notice however that $\mathbf {1}_n^TCX^* = \mathbf 0_p^T$, a row matrix of zeros.
This is easy to see, because multiplying by the row matrix of ones results in the column-wise sums of a matrix (we used this fact to build $C$), but each column in $CX^*$ sums to 0.
Also, notice that $\mathbf {1}_n^T\mathbf {1}_n = n$.
And lastly $C^2 = C$ (i.e., centering a matrix twice has no additional effect):
$$C^2 = \left(\mathbb I_n - \frac{\mathbf {1_n1_n}^T}{n}\right)^2\\
=\left(\mathbb I_n - \frac{\mathbf {1_n1_n}^T}{n}\right)\left(\mathbb I_n - \frac{\mathbf {1_n1_n}^T}{n}\right)\\
=C - \frac{\mathbf {1_n1_n}^T}{n} + \frac{\mathbf {1_n}\color{red}{\mathbf {1_n}^T\mathbf {1_n}}\mathbf {1_n}^T}{\color{red}{n}\cdot n}\\ =C$$
Putting these together:
$$
(L^TL)^{-1}
=\left(\matrix{
n & \mathbf 0_p^T\\
\mathbf 0_p & X^{*T}CX^*}\right)^{-1}
$$
By block inversion we can write the following:
$$\left(\matrix{
n & 0 \\ 0 & B}
\right)^{-1}=
\left(\matrix{
n^{-1} & 0 \\ 0 & B^{-1}}
\right)
$$
Substituting $A = \mathbf {1}_n^TCX^*$, $B = X^{*T}CX^*$:
$$
(L^TL)^{-1}
=\left(\matrix{
n^{-1} & \mathbf 0_p^T\\
\mathbf 0_p & (X^{*T}CX^*)^{-1}}\right)
$$
Our coefficients become:
$$\hat{\beta_L} = (L^TL)^{-1}L^Ty\\
=\left(\matrix{
n^{-1} & \mathbf 0_p^T\\
\mathbf 0_p & (X^{*T}CX^*)^{-1}}\right)
\left[\matrix{\mathbf {1}_n^T \\ X^{*T}C}\right]y\\
=
\left[\matrix{n^{-1}\mathbf {1}_n^T \\
(X^{*T}CX^*)^{-1}X^{*T}C}\right]y
$$
Similarly for $X$:
$$
(X^TX)^{-1}=
\left(\matrix{\left[\matrix{\mathbf {1}_n^T \\ X^{*T}}\right]}\matrix{[\mathbf {1}_n & X^*]}\right)^{-1}\\
=\left(\matrix{
n & \mathbf {1}_n^TX^*\\
X^{*T}\mathbf {1}_n & X^{*T}X^*
}\right)^{-1}
$$
Block inversion leads us to
$$
(X^TX)^{-1}=
\left(\matrix{
A & B \\ C & D
}\right)
$$
\begin{cases}
A = n^{-1}+n^{-2} \mathbf {1}_n^TX^*\color{red}{(X^{*T}X^*-n^{-1}X^{*T}\mathbf {1}_n\mathbf {1}_n^TX^*)}^{-1}X^{*T}\mathbf {1}_n\\
B = -n^{-1}\mathbf {1}_n^TX^*\color{red}{(X^{*T}X^*-n^{-1}X^{*T}\mathbf {1}_n\mathbf {1}_n^TX^*)}^{-1}\\
C = -n^{-1}\color{red}{(X^{*T}X^*-n^{-1}X^{*T}\mathbf {1}_n\mathbf {1}_n^TX^*)}^{-1}X^{*T}\mathbf {1}_n\\
D = \color{red}{(X^{*T}X^*-n^{-1}X^{*T}\mathbf {1}_n\mathbf {1}_n^TX^* )}^{-1}
\end{cases}
This isn't necessarily the nightmare it appears to be.
Notice the terms in red.
They repeat.
The part in blue below is exactly $C$!
$$\left(X^{*T}X^*-X^{*T}\frac{\mathbf {1}_n\mathbf {1}_n^T}{n}X^* \right)\\
=X^{*T}\left(\color{blue}{\mathbb I_n-\frac{\mathbf {1}_n\mathbf {1}_n^T}{n} }\right)X^*=X^{*T}CX^*$$
Substituting it back into $A,B,C,D$ so we don't lose track:
\begin{cases}
A = n^{-1}+n^{-2} \mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T}\mathbf {1}_n\\
B = -n^{-1}\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}\\
C = -n^{-1}(X^{*T}CX^*)^{-1}X^{*T}\mathbf {1}_n\\
D = (X^{*T}CX^*)^{-1}
\end{cases}
The coefficients are then:
$$\hat{\beta_X} = (X^TX)^{-1}X^Ty\\
=\left(\matrix{
n^{-1}+n^{-2} \mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T}\mathbf {1}_n &
-n^{-1}\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1} \\
-n^{-1}(X^{*T}CX^*)^{-1}X^{*T}\mathbf {1}_n &
(X^{*T}CX^*)^{-1}
}\right)
\left[\matrix{\mathbf {1}_n^T \\ X^{*T}}\right]y
\\=
\left[\matrix{
(n^{-1}+n^{-2} \mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T}\mathbf {1}_n)\mathbf {1}_n^T - n^{-1}(\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T})
\\
-n^{-1}(X^{*T}CX^*)^{-1}X^{*T}\mathbf {1}_n\mathbf {1}_n^T + (X^{*T}CX^*)^{-1}X^{*T}
}\right]y
\\=
\left[\matrix{
n^{-1}\mathbf {1}_n^T+n^{-1} (\color{green}{\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T}})\frac{\mathbf {1}_n\mathbf {1}_n^T}{n} - n^{-1}(\color{green}{\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T}})
\\
(X^{*T}CX^*)^{-1}X^{*T}\left(\color{blue}{\mathbb I_n - \frac{\mathbf {1}_n\mathbf {1}_n^T}{n}}\right)
}\right]y
\\=
\left[\matrix{
n^{-1}\mathbf {1}_n^T+n^{-1} (\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T})\color{blue}{\frac{\mathbb I_n - \mathbf {1}_n\mathbf {1}_n^T}{n}}
\\
(X^{*T}CX^*)^{-1}X^{*T}C
}\right]y
\\=
\left[\matrix{
n^{-1}\mathbf {1}_n^T+n^{-1} (\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T})C
\\
(X^{*T}CX^*)^{-1}X^{*T}C
}\right]y$$
Now compare:
\begin{matrix}
\hat{\beta_L} =
\left[\matrix{n^{-1}\mathbf {1}_n^T \\
(X^{*T}CX^*)^{-1}X^{*T}C}\right]y
&
\hat{\beta_X} =
\left[\matrix{
n^{-1}\mathbf {1}_n^T+n^{-1} (\mathbf {1}_n^TX^*(X^{*T}CX^*)^{-1}X^{*T})C
\\
(X^{*T}CX^*)^{-1}X^{*T}C
}\right]y
\end{matrix}