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Custom WC doesn't work like quite that...there's no limit to how well you can cool. You can just keep adding more radiators and have more and more cooling capability. How well custom WC cools is your choice completely.
Mid-tier AIOs aren't worth it for the simple fact that they're still outperformed by air heatsinks. High end AIO (H80/H80i/H90/any of the dual fans radiator) is worth it.
In the strictest sense, a heatsink and radiator are both heat exchangers, however, to avoid confusion, it's best to refer to air cooled heat exchangers as heatsinks and liquid cooled heat exchangers as radiators. Common nomenclature.