The absolute worse for me was when I found myself trying to explain to my grandma that you must ALLOW cookie preferences, but you must absolutely DENY notification permissions. For trying to read some news online... The web is a harmful mess.
The shitty thing is, she'd probably be better served by denying cookie preferences... but despite whatever regulations say, companies find impressively difficult ways to keep the user from answering "no, please don't spy on me".
Every cookie banner that I've ever clicked "no" on has let me proceed to the main site. The user is still a potential viewer of ads, even if they can't be microtargeted, so it's worth it to the site to let them proceed.
i hope you understand the inherent irony of your second suggestion, but if you missed it: I Don’t Care About Cookies just got bought by one of these companies known for similar types of abusive UX (surveillance-ware).
There is a fork by the community "I still don't care about cookies" (note the "still") that should avoid any evil stuff Avast would do to the original extension.