Exactly. The difference between the two is not qualitatively different for 99% of users.

I noticed that UBO Lite doesn't cause the ad boxes to vanish like UBO does. You see this on the likes of the weather.com webpage.

Exactly. The Lite version is basically "hiding" ads rather than blocking. The MV2 version stops the requests themselves from being made which save your bandwidth and battery. The light version lacks those benefits

That's manifest V3 working as intended.