I have had similar experiences in the past of ads appearing on other words not associated with any of the keywords I had inputted. The content generator is, I believe monitors other similar ads from others account and can choose to place yours with associated successful keywords inputed with in others ads to give you optimised performance.
This also begs a further question of brand name bidding, for example is it fair that a merchant bans brand names when they have a generic word in their name such as example "john Screwdriver, the famous hardware store" (fictional). You may have the keyword screwdriver or screws or can even have diy and google probably will pitch your ad on the merchant above, as you will have the content generator on to optimise your ad.
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