All-solid-state batteries offer enhanced safety and energy density compared to conventional systems, but their performance critically depends on the microstructure of the composite cathode. Sulfide-based solid electrolytes (SEs) are promising Li-ion conductors, yet they degrade upon contact with cathode active materials, necessitating passivating coatings that impair electronic conductivity. Herein, an electron-conducting matrix of SE and 4 wt% conductive additive (C65) at the percolation threshold is introduced to minimize side reactions. The effect of coated active material fraction on ionic and electronic conductivities is investigated using electrochemical impedance spectroscopy, rate tests, 2D/3D imaging, and numerical simulations. The results highlight the critical role of the electronically conductive network, which percolates at low CAM loadings, collapses at 50 wt% as C65 adheres to coated CAM surfaces—depleting the bulk network—and recovers at higher loadings via percolation of C65-coated particles, demonstrating the essential function of C65. At 70 wt%, a robust network yields 99.8 mAh g$^{−1}$ at C/10 and 84% retention at C/5; at 80 wt%, ionic conductivity diminishes despite improved electronic transport, reducing rate performance. These findings underscore the need to balance ionic and electronic pathways and provide new insights into the role of additives in composite cathodes.