System Data

System Data is a general bucket for things macOS either doesn't count separately or doesn't recognize. Much of it is located in your ~/Library folder. By default many apps store user data inside ~/Library ... including iOS backups; email (Mail, Outlook, Thunderbird, etc.; and others. Update dmg files are stored there. Also, apps store their app support data & cache files in ~/Library and there have been reports of some apps not cleaning up their cache files.

My best suggestion is to get an app like Daisy Disk, Grand Perspective, Omni Disk Sweeper, etc. to help identify what's taking up all that space on your drive.

Important note ... macOS and apps store important and required data in ~/Library. The ~/Library folder is hidden by default in order to protect users from deleting things they shouldn't touch. Be very careful about poking around in ~/Library and especially if you think you want to delete something there.

What is “Other” storage on a Mac, and how can I clean it out?

Free up storage space on your Mac

OmniDiskSweeper Safe to use

GrandPerspective 

How to delete Time Machine snapshots on your Mac

See used and available storage space on your Mac

Locate backups of your iPhone, iPad, and iPod touch

The final word from Apple on Managing the " Other " Category

Other: Contains files that don’t fall into the categories listed here. This category primarily includes files and data used by the system, such as log files, caches, VM files, and other runtime system resources. Also included are temporary files, fonts, app support files, and plug-ins. You can't manage the contents of this category. The contents are managed by macOS, and the category varies in size depending on the current state of your Mac.

Go back to About This Mac > Storage and click the Manage button (you can see it in the screenshot you provided). Let your Macbook Air run until the detail window completes analyzing your SSD's storage. Post a screenshot of the results. It will look similar to this:

It will give us a better basis for suggesting what may be taking up the space on your SSD.

Added - this situation may have occurred because the computer has been upGraded several times since 2015 ( 7 years )to now.

The accumulated affects of all these upGrades may have created this situation.

Last year is fine but has zero bearing to be brutal about this. What was installed since new and / or if Migration Assist was used when first setup as New does have a major bearing.

Has the user tried any of the previous suggestion ?

Mac-Mini-M1 ~ % diskutil list

/dev/disk0 (internal):

   #:                       TYPE NAME                    SIZE       IDENTIFIER

   0:      GUID_partition_scheme                         251.0 GB   disk0

   1:             Apple_APFS_ISC ⁨⁩                        524.3 MB   disk0s1

   2:                 Apple_APFS ⁨Container disk3⁩         245.1 GB   disk0s2

   3:        Apple_APFS_Recovery ⁨⁩                        5.4 GB     disk0s3

/dev/disk3 (synthesized):

   #:                       TYPE NAME                    SIZE       IDENTIFIER

   0:      APFS Container Scheme -                      +245.1 GB   disk3

                                 Physical Store disk0s2

   1:                APFS Volume ⁨Macintosh HD⁩            15.2 GB    disk3s1

   2:              APFS Snapshot ⁨com.apple.os.update-...⁩ 15.2 GB    disk3s1s1

   3:                APFS Volume ⁨Preboot⁩                 643.2 MB   disk3s2

   4:                APFS Volume ⁨Recovery⁩                783.1 MB   disk3s3

   5:                APFS Volume ⁨Data⁩                    16.0 GB    disk3s5

   6:                APFS Volume ⁨VM⁩                      20.5 KB    disk3s6

Those in Bold represent the difference between you setup and more.

A @ MartinR has suggested and was suggested much earlier in you question. The method to find what is using all the storage on this drive that you ( the User ) has control over

Other: Contains files that don’t fall into the categories listed here. This category primarily includes files and data used by the system, such as log files, caches, VM files, and other runtime system resources. Also included are temporary files, fonts, app support files, and plug-ins. You can't manage the contents of this category. The contents are managed by macOS, and the category varies in size depending on the current state of your Mac.

Sorry but that is the reality as per Apple

Just to compare the same Sized Internal Drive as yours 251 GB Capacity

Terminal command " diskutil list " without Quotation marks and what is the output