Aniston,
Google will slap the campaign, keywords and ads for the url violation. Once an ad gets slapped for the url violation it stops running on both the search network and content networks.
That being said, I have seen some inconsistencies in how AdWords enforces its rules across campaign adgroups. I have a couple of adgroups in one campaign where I had an ad in one adgroup flagged for a copyright keyword violation which I fixed, but the same keyword in the other adgroup still gets served on the content network so go figure.