I'm not terribly impressed with Search Ads yet either. I've had 1,449 impressions but only 15 views and 1 new favorite. No sales, no convos, etc.
I have found it interesting to watch the "By Item" list in the Seller Ads Stats. The first day, my bay leaf garlands were getting NO love at all, then that evening all of a sudden, they jumped to the top of the list (I'm advertising 4 specific items). And now, since yesterday afternoon, my stamped flag pillow has taken over first place. Who would have thought people would be interested in Americana at this time of year? (Well, I hope they are on Sunday cuz these are going to a show with me!)
I, too, am bummed that we can't choose our own key words. For example, with my bay leaf garlands, "leaf" is a possible key word, but not "bay leaves." Leaf is obviously too generic, so I didn't choose that as a key word.
Having said that, I did read something last night that might help! Look at this list:
http://www.etsy.com/search-ads/keywords and find words that describe your product(s) being advertised. Add these words to your tags and then they SHOULD be keywords that you can use in your ads! I tried that to add the word "Americana" to my key words and it worked! My understanding is that the words on this list are the ONLY words which Etsy uses for keywords; whether that will change over time, I don't know.