Campbell
Relaxed Intensity
So ... I'm not looking to argue, here, but when would you say the ability to negate removes agency? Does the fact the GM can say "no" to any given action the players propose mean (to you) that the players never have agency? Even if the GM approximately never says "no"? I think it's obvious that some games will vary more in this regard from table to table than others will.
From my perspective if not constrained at least by social expectations that they will play with integrity absolutely there is no meaningful agency to be had. From my perspective if manipulation of setting to achieve certain outcomes or picking and choosing when to apply the rules when not guided by something exceptional in the fiction, or fudging dice rolls is ever an option then it is always an option. By choosing not to do these things in a given moment of play you are still making an active decision as a GM. You have all the influence. The players have none except through you.
It pretty much ruins the integrity of the whole thing for me personally.