Yeah, I think you pointed out what I was thinking.
There is a part of an RPG which is "let the rules and dice tell you how it resolved." Which is to say, if the player wants to do something, then you say "Yes" and let them interact with the
rule that guides them on how to do it. (Skill rolls, attack rolls, etc)
Then there is this other part which is
Narrative play. This comes into play with The Fiction. And that is "all the things described by the GM in the scene."
Meaning that a player assuming an outdoor attack on a roadside might have a hill side to the path which has rocks the orcs can slip and fall on = seems reasonable, even if the GM never mentioned a hill or rocks, it fits The Fiction and so there is no reason to say no.
The fear then comes in with the
halfling saying "I fly up the hill", and there is
no Fiction to indicate the halfling can fly in any way. I think this is actually a
straw man argument. Personally, I have never ever had a player, so egregiously, dictate their character doing something that has no reason or rule or ability to back it up. And I run both PBTA and Cortex, where a player can define a power's use in pretty much any way they can imagine - and it still never happened.
But let's assume it did happen, and let's assume the GM still wanted to say Yes to everything. I would fall back to Blades in the Dark concepts of Flashbacks or such and say "Yes, ok. Tell us how, when you were back in town, you stole a scroll of flight. Who was it stolen from and how did you get away with it?" That both makes the character sound like a awesome sneaky halfling which backs up their Fiction. And it keeps play going in an interesting way. I can even say "Make a Stealth roll to see if they know you stole it, even though you clearly got away. There is a chance they will remember that slight, or send a bounty on you."
= Remember GMs - a failed roll does not always mean they didn't do the thing - it can also mean there are consequence's that follow their fumbled success!!!
So yeah, even in situation where player goes off the rails, a GM can easily bring it back to the functional game and nothing is ruined, and the scene is more fun for it.
Saying "No" would be to turn the GM into the dice, turn them into the Rules. And that's not what "Rulings not Rules" means IMHO. Saying No tends to come up most often when a player wants to declare something in the Fiction as true, and the GM saying No. As my example above shows, there is not often if ever a good reason to do that (plus the straw man that this is even a meaningful issue at all. players tend not to just disregard the Fiction utterly).
And I can even think of many times where the player's idea and suggestion is far better than what the dice and rules can create, so sometimes its even good to say Yes to the player saying "I kill the orc" with no roll or damage. The way they accept the GM response of "You are tired and here are 5 more orcs." to become a fun assassin's creed style chase = worth it over init+tohit+damage rolls. (again in some cases).
Saying No in that case is saying "No I don't like your direction with the scene and events, stop doing that and just roll the limited options the rules and dice allow." =
See above. Plus what clearstream said... that may help? otherwise I dunno either
Yes a tangent. No not really to do with saying Yes in any way I can see. But regardless - I don't think you should eat yourself up for this. I think at some point, ore often or less = all GMs do this.
It can be helpful, players would rather get a hint or offering that get stuck or blindsided. So that's cool.
It can be helpful to keep pacing going and prevent players from going in circles that accomplish nothing. So that's good
It can be helpful to guide players into competent actions based on their character they may not be thinking of, especially new players. So that's fun.
Taking agency away is telling them "this is your only option" and "I am telling you how your character acts, you must accept it and go from there." It does not sound like you are doing that.
Also, between me and clearstream and my comments above, is your example of "saying no" answered?