"Baked ambient occlusion" does exist. It only works well in games where most objects are fixed. If there's a lot of flexibility in where objects are placed, then movable objects will stick out too much (they will lack the AO shading). It sounds like you're proposing using it only on static walls, which seems like it'd be totally viable.
replySplinter Cell Conviction did this well, ambient occlusion got baked for pretty much all models, even dynamic. The dynamic occlusion for characters was solved by approximating them as a bunch of ellipsoids.
replyhttps://www.gdcvault.com/play/1012326/The-Rendering-Tools-an...
The jitter is because it's usually rendered at 50% resolution - you can render it at full framebuffer size and it doesn't jitter but it's kind of hard to justify.
replyThat might be part of it, but the effect I’m describing includes the shading changing shape. So for example if a bust on a pillar is sitting in a corner, as the camera pans around the bust, AO behind the bust shifts to “wrap” around the edges of the bust which looks strange because no shadow in the real world acts like that.
replyThis is largely because early screen-space AO techniques weren't able to accurately estimate whether the pillar is freestanding (and shouldn't darken the wall) or if it is against the wall (and should darken the wall.)
replyModern real-time ambient occlusion techniques can estimate the depth far more accurately and produce correspondingly more believable results, at the cost of performance.
https://www.researchgate.net/figure/Visual-comparison-of-dif...