My take is that Google is applying the 80/20 rule to Adwords. Or more accurately it's probably something like the 99.9/.1 rule in their case.
They realize that most of their profits are coming from the big accounts and they frankly would rather just ban the small accounts. Of course, that would cause a stir.
So they basically let small accounts use the system as long as those advertisers are fortunate enough to not trigger some hidden infraction. If they do, well, too bad.
It's all about having plausible reasons to ban as many small accounts as possible. There's no world where retroactive regulations make sense if you're really trying to not be "evil".
I'm seeing new accounts getting banned for life in under 24 hours for advertising brick & mortar small businesses. Or they just get dropped into perpetual "waiting approval" states for weeks and months.
And then there's the "associated accounts" ban. I've seen reports this has been triggered by using wireless at coffee shops, library computers, etc. because for example, a previously banned advertiser may have logged into Gmail on those same IPs. These people are then banned without any recourse.
Google simply does not care. They seem to feel that their results are best filled with their own properties and Fortune 500 brands.
If you're a little guy, keep your head down. And pray.