Which option? Allowing AGPLv3 use in Google? IANAL, but the usual reason is:
a) use is redistribution,
b) redistribution means you have to produce the source on demand,
c) now you have to produce unknown parts of google3 on demand
With the added kicker that smart people (Eben Moglen, Lawrence Rosen) disagree on exactly what you have to do for the copyleft clauses to kick in. For example: if you import an AGPLv3 Python library versus it loads you versus dlopen a library vs statically link one.
There is no legal precedence to define when a combination of different work create a single work. In theory a program linked with a library could be seen as one work, or two works that interacts, and this is where the disagreement comes when lawyers discuss linking technology. The reason why there is no legal precedence is that no lawyer of a company being accused of copyright infringement has argued the point of the work being multiple rather than a single one.
Why has no company done this? Lets look at an example. Back a few years ago when "cloud" was a major buzz word people were suggesting to turn gaming into a service. A cloud provider would buy a single copy and serve millions by running the game locally and providing a remote desktop like environment to the user. The game industry reply was that this would be copyright infringement. A single copy and millions of users would obviously be wrong, no matter what technology is used to enable it. Their bet is that a judge would see very similar on the issue.
The question about what a judge or jury would think is very significant. Do they care if a library is linked statically or dynamically, or if the programming language is intepreted or compiled? Will those technical aspect determine the question about what constitute "the work"? My bet, and many others including Eben Moglen seem to be that judges and juries will not. What do you think?
For a company to design a policy as a method of avoiding risk, they don’t have to believe that’s how it should work, but rather just that it’s plausible. My point is that, like you said, we don’t know: we can only guess.