Account level vs campaign level negatives - when does the difference actually matter?

Your instinct is the rule. I would write it as three questions, asked in order: Would this term ever be relevant to any part of this business? If no, account level. Employment, DIY, competitor names for most advertisers. Is it wrong for this campaign but fine for another? Campaign level. The classic is a term that belongs to the brand campaign and must not be picked up by the generic one. Is it right for this business and this campaign, but should be answered by a different ad group? Ad group level, and this is the only legitimate use of it. That third case is rarer than it used to be, which is why it feels like it has no purpose. Traffic sculpting between ad groups made sense when the match type determined the bid. Under smart bidding you are mostly just adding maintenance burden. For the scattering you have inherited: I would audit ad group level specifically. That is where the accidental blocks live, because someone adds a negative while looking at one ad group and does not realise the term was valuable to a neighbouring one.

Adding the operational half of this, from having got it wrong at scale: write the rule down somewhere the team can see it, and put the date and the reason next to every account level negative. Account level is the level with the widest blast radius and the least visibility. Nobody opens that list for months, and then somebody finds a term that's blocking something and has no way to tell whether removing it is safe.