The Search Terms Report shows the actual search terms users were using when they saw your ad. This is important because if you are showing ads to ‘irrelevant searches’ you are most likely wasting your budget and impacting your quality score.

To refine this you could add more keywords to your negative keywords lists.

I think that that automated campaigns can work very well - however there is never a guarantee they will work on every single instance and if your campaigns are working well then it’s a risk. Personally, I would use an A/B test on the campaign to see if it makes a difference. A few weeks of data you will see factually what works better.