"May" gives you an option in M44. If taking ground does not benefit you, you do not have to do it. If accepting a flag instead of ignoring it helps you, take it. Most times, a double flag when behind sandbags is worth taking both. Remember if you vacate the hex, though, the sandbags disappear.
There are some situations int eh expansions that tell you that you "must" do something. For example, Japanese infantry "must" ignore the 1st flag and "must" ignore all flags when on a cave hex.