If you feel that the Ancients did not use "absolute camouflage", was there anything else they did (insofar as the Ancient monologues in FS1 are concerned) that might be relevant here?
I think it is not in dispute that the Ancients tried all kinds of survival tactics but ...
1) Your line of arguments is based on the assumption that the Narrator of the Ancients cut-scenes is omniscient - which is contradicted by them framing the events in a narrative of sin and punishment and by it being recounted from the first perspective (the plural doesn't really change much there), which put into questions it's accuracy and completeness.
Relevant quotes:
- Ancients 2
Now we know our crime was sin.
Emphasis: sin = 1. A violation of divine will or religious law.
- Ancients 4
We know our fate. [...] When we traveled subspace, the cosmic destroyers took note.
Emphasis: cosmos = 1. The universe. 2. An
ordered, harmonious whole; cited for relevance to the theme of sin and punishment.
2) Your line of arguments builds on the idea that the Narrator speaks for the entire the Ancients' Empire. As their omniscience is debatable, it might very well be that they don't not speak for all parts of the Empire - particularly because the Ancients 1 opens the door for their empire to encompass more than one species in a hierarchy (see quote 1) - of whose ruling elite the narrator can be assumed to be part off (see quote 2). Both can be taken to assume considerable blind spots in the Narrator's perspective, which can be leveraged for a take on the Ancients that goes beyond the explicit canon.
And we saw other advanced life. And we subdued it or we crushed it. In months the extermination of billions of years of evolution on a similar but slower path.
Yellow emphasis: "to subdue" = 1. To overcome, quieten, or
bring under control. 2.
To bring (a country) under control by force.Green emphasis: statement of alternative
Red emphasis: While this sentence seems to be a counterindication for the continued (co-)existence of the any advanced life encountered by the Ancients' Empire, it seems to me that it is less a statement of fact rather and argument for narrative of sin and punishment. Not to mention that sentence is just
odd.
Ours was a proud people, and always the strongest. For thousands of years our empire expanded
Emphasis: First Person Plural in a statement of belonging or ownership.
(I already expaned on the concept once before - and also on why despite having some merit, I don't pursue it -
link)
3) Independent from 1 and 2, your line of arguments says that their efforts to achieve the "absolute" qualification for their efforts had been successful as part of the mentioned retreat. The Narrator's faction of the the Ancients' Empire may have failed to develop any camouflage standard so far as it would meet the definition of "absolute camouflage".
Side Note: One of the vectors for the idea of developing an "absolute" camouflage into the GTVA or any third party may have come from discovering the failed attempts of the Ancients to develop it; or even discovering it in the remains of the civilisation brought to ruin by the Ancients ... or maybe even from the discovery of an Ancients enclave that was successful in its development. (see the mention of "Foreign Relations" in the OP)