At my university, we stress to grade at the local activity level. The main advantage I inform my faculty of doing so is that they then only see submissions and grades of that assignment. They won't get distracted by seeing all the grades from other assignments. In addition, the submission is stored at the activity level so there is no reason to read the submission and then take extra clicks just to get to the gradebook.
An analogy I use when teaching gradebook workshops is to describe the gradebook as the federal government and the activity as the local goverment. The federal government doesn't make all the laws; it leaves many decisions up to the local government. (E.g. person wouldn't go to federal level to complain about trash in local park; they would go to local government for help) The federal level always overrides the local level though.
When there is no grade entered yet, that is like neither government has passed a law on it yet. When you enter a grade in the local activity, this is pushed to the gradebook. Since there was nothing in the gradebook/federal level to begin with, the grade sticks in the gradebook. If after entering a grade in the activity/local activity, you then go directly in the gradebook and enter a grade, then the one in the gradebook will "override" the local activity grade. (E.g. Supreme court overruling city council on how to keep park clean) Since there is now a gradebook/federal level grade, what the activity/local level had entered is ignored and nothing new can be added at this level unless this override is removed. To turn off overrides is then a big pain because it is like Congress having to go back and review the laws and make changes.