The overarching problem here is that the 2.4GHz band is completely saturated in any moderately populated area. In addition, there are only 14 channels, depending on country, available to use. Out of those 14 only 3 channels don’t overlap and interfere with each other. And that is only true if the device uses only 20MHz of bandwidth and not the 40MHz bandwidth available on some access points.
All properly configured Wi-Fi routers should only use channel 1, 6, or 11 at 20MHz bandwidth. An access point stomps on the signals of any nearby access points for at least 2 channels higher and 2 channels lower from itself. Worse if it’s on 40MHz bandwidth.
When access points can see each other, on the same channel, they will cooperate and share the air space. If two access points are using nearby, but different channels, then they stomp on each other and each collision results in lost data.
Unfortunately, most modern Wi-Fi routers, for simplicity, default to auto-channel selection. However, they do not adhere to the 1, 6, or 11 rule. Instead they use a proprietary algorithm that is probably based on the usage of each channel. This causes severe and unavoidable interference of nearby networks, practically rendering the 2.4GHz band useless in some areas. In addition, the auto-channel selections usually only happen during a reboot or rarely at all. So the channel selection can quickly become stale as nearby access points also jump channels and compete to find the “cleanest” channel. To make things worse, the channel selection is based on what the AP hears, and not what the client hears, which may be closer to a different set of APs.
So, the problem is not the selection mechanism, but the fact that the 2.4GHz band is just completely saturated. Not only by Wi-Fi access points, but by cordless phones, microwaves, Bluetooth, baby-monitors, wireless cameras, and any number of other technologies.
The answer is to use the 5GHz band. There are dozens of 5GHz channels available. None of which overlap with others if the standard 20MHz bandwidth setting is used. This means that all devices using the 5GHz band can cooperate with each other without interfering. Unfortunately, Wireless-N and especially Wireless-AC allow for wider channels which overlap in an attempt to provide greater throughput. So, even in the 5GHz band, you should be conscious of co-channel interference and choose your settings wisely, rather than utilizing auto-channel selection.
In a densely populated area, the use of wide channels will provide little, if any benefit and could actually make things worse.