How it works
The shop hands Merchant Center a feed — a file with all its products and their attributes. Google checks every product: do the price and availability match the site, are the required fields filled in, does the listing break any rules. Products that pass become available to advertising, the rest are disapproved and never reach impressions.
Google Ads takes products from exactly here: without Merchant Center there is no shopping advertising at all. That is why most impression problems are fixed not in the campaigns but here — in the data.
Why it is a separate account
Merchant Center and Google Ads are two different accounts, and they are linked by hand. A mismatch between them gives the familiar picture: the product is in the feed, but not in the ads. The portal reads both and shows at which step the product got lost.