Actually, Definition #2 is a misnomer.
A neg is not a light insult wrapped in a compliment, nor is it being mean for mean's sake.
The real definition of a neg (straight from the horse's mouth): A neg is active disqualification. It shows that you aren't hitting on a particular woman and don't have interest in her *at that particular moment*. You're not being mean, per se, you're telling her that she does not meet your standards of attractiveness.
It isn't a direct comment, either. When you're engaging a group you can "toss it like a pebble" at her or towards her social circle.
Many, many guys use this the wrong way, and end up leaving people with a bad taste in their mouth. To be used by licensed professionals, only.
A standard neg:
"You and I would never get along. We're too similar. You'd never take my sh*t, and I'd never take yours."