Most of what makes people effective at large companies is neutral or negative value when applied to very early-stage companies.
A significant number of the people in Area 120 projects were folks who were stifled and/or wasted in their previous Google jobs. One explicit purpose of Area 120 was to prevent the loss of these entrepreneurs to outside startups. Not incidentally, this was a form of cultural reinforcement - Area 120 burnished Google’s reputation as a good home for entrepreneurial mindsets.
So basically google had a shed where they hoarded talented people, to prevent competition? :)
That's a succinct description of why Microsoft Research was created.
2) in general, early Google used to hoard talent all the time. The founders would keep great people (or their friends) on payroll for ~ever just to have them stick around. That was most prevalent in the first decade of Google’s life, to my knowledge, and mostly applied to very senior people.
By the time Area 120 was pitched and approved (circa 2014), those days were largely gone. Area 120 was primarily filled with junior people (L4-L6) and constantly had to sing for its supper - it was not at all a sinecure.
These are rather the top 10 % sycophants, not the top 10 % researchers or top 10 % programmers.