>Read the manpage for all the hilarity.
If you find it hilarious it's because you don't understand the reason. /usr belongs to the distribution and /etc belongs to the user. The distribution doesn't touch /etc and the user doesn't touch /usr.
Upstream ships a unit with its own opinion of the defaults. That unit goes in /usr.
Distribution would like to override a default. It can patch the file but that is somewhat harder to discover (it would require reading the package source). Alternatively it can add a drop-in. That drop-in goes into /usr too since it's a distribution file.
User would like to override a default. They should not edit /usr because that belongs to the distribution. They drop their override in /etc.
Some units are created at runtime on demand and thus ephemeral, like mount units generated by generators. These go in /run. These are functionally "system-provided units" because users must be able to override them, so they're below /etc in the hierarchy.
The "defaults" and "overrides" we're talking about are both at the level of the individual setting as well as at the level of the whole file. If a user wants one of the settings to be different, they can add a new 99-foo.conf file that unsets / changes it. If they want a whole file to be different, they can add a new file with the same name that is empty / has different values for its settings.
BTW `systemctl cat whatever.unit` will print all the files that systemd considered in the order that it considered them.
>And this is just an excerpt which doesn't cover the details.
The only detail your excerpt doesn't include is the consideration of `service.d/`, `socket.d/` etc directories which provide overrides for all units of that type. It's just one point, not commonly used, and not that big of a deal either.