fredriksthlm Yeah it is quite a confusing issue. In my mind you shouldn't need to set "child directed" as setting your content rating to "G" should imply that it's suitable for children.
I expect the method to set content rating from the app is an additional method to allow more specific control ( per user as opposed to per app ).
Yes, if you set the ad rating to G in Admob for the app it should only serve ads that are suitable for children. (The standard is that the app ad rating is derived from the account ad rating, which can be set to other than G... So you really need to verify that it is really G, before posting the build that are going to review. And if something was not compliant and you need a new review it is needed to post a new build, even if you didn't change anyhing. Otherwise they will use the old review.
I got some rejection one time for an ad violation as well, I just replied I used their service, so I cannot be responsible of the ad content! They replied this:
Thanks for contacting the Google Play team.
Status of app: Not available on Google Play, pending your action
We’ve accepted your appeal and included details below about what additional steps you’ll need to take to get your app to appear on Google Play.
Action required: Submit your app
In order to show your app on Google Play, please submit your app again:
Sign in to your Play Console. Make sure to increment the version number of the APK.
Select your app.
Select Store presence > Store listing.
Click Submit update or Resubmit app.