Clearly, Google is serious about trying to oust ad blockers from its browser, or at least those extensions with fuller (V2) levels of functionality. One of the crucial twists with V3 is that it prevents the use of remotely hosted code – as a security measure – but this also means ad blockers can’t update their filter lists without going through Google’s review process. What does that mean? Way slower updates for said filters, which hampers the ability of the ad-blocking extension to keep up with the necessary changes to stay effective.
(This isn’t just about browsers, either, as the war on advert dodgers extends to YouTube, too, as we’ve seen in recent months).
At any rate, Google is playing with fire here somewhat – or Firefox, perhaps we should say – as this may be the shove some folks need to get them considering another of the best web browsers out there aside from Chrome. Mozilla, the maker of Firefox, has vowed to maintain support for V2 extensions, while introducing support for V3 alongside to give folks a choice (now there’s a radical idea).
You where talking about “system wide AdGuard”, which is not the browser addon, but an app that uses DNS blocking, be it by either letting people set DNS servers manually, or automatically through VPN. Their VPN does not break TLS connection by inserting custom certificates and MITM proxies, so they cannot read/modifiy content.
It might be possible to use TLS breaking proxies for systemwide ad blocking, but even that wouldn’t help, because nowadays a lot of content and ads are loaded dynamically via javascript. So a browser is required to filter ads.