At one time, I was regularly shooting MFT 16Mpix, MFT 20Mpix & Sony FE 61Mpix. I now mostly switch between 20Mpix and 61Mpix. I've also shot FT 8 & 12Mpix and FE 36 & 42Mpix.
Essentially you are right that cropping is the same as shooting with a smaller sensor but otherwise the same settings.
For example, the FE bodies can be made to produce an APSC RAW crop from their sensor, which they do automatically if you mount an APSC lens on an FF body. That gives 61/1.5/1.5 ~= 26Mpix resolution and the DR of an APSC sensor. That's remarkably close to what you would get mounting the same FF lens on an A6xxx E-mount APSC body.
If you crop further to MFT size and aspect ratio, you get the DR of an MFT sensor and about 15Mpix, so about the same as an older MFT sensor like my GM1 or EM1.
Things get a bit more complex if you buy an older DSLR body because some of them had sensors significantly worse than modern sensors. For example older Canon DSLRs had DR a bit worse than modern MFT bodies, despite being 4x the area. Unless you bought a really expensive EF lens, OM Pro and Panasonic Leica lenses are usually better than standard range EF lenses. Modern lens technology has advanced as much as sensors.
So, if I shoot an OM5 with the PL 25/1.4 attached at say f1.4 1/100s and an A7CR at 50mm f2.8 1/100s, I get similar images but with different aspect ratios and likely more detail and "pop" in the FF image, depending on the FF lens used. I have a CV 50/2 APO Lanthar, which is a better lens than the PL, so that would deliver.
In theory if the MFT body was at ISO 200, the FE one would meter at ISO 800 in auto-ISO but that depends so much on jpeg settings and metering. Both sensors are relatively ISO invariant and I shoot RAW, so it's the aperture and shutter speed that matter, since ISO only affects exposure via metering against jpeg output.
Does the difference between MFT 20Mpix and FF 61Mpix matter? Well yes, otherwise I wouldn't have both. It only matters photographically for what I shoot when I am shooting landscape (detail and DR) or a high DR scene (like an interior with light streaming from windows) Since I'm a RAW shooter, I can claw back quite a bit of the difference by using a Custom UniWB to reduce the loss of exposure headroom from jpeg metering.
IS makes quite a bit of difference when shooting handheld in low light, for example inside churches. My OM5 will beat my A7Riv at that every time. The A7Riv needs a tripod.
Lenses matter a lot - for example veiling glare around windows, LoCA etc. The best MFT lenses are pretty good (but expensive), although there are fails like the OM 20/1.4.
The other advantage of FF is that zooms start getting big and expensive below about f2.8, and primes below about f1.8. Compare the weight and cost of a PL 12-35/2.8 with a PL 10-25/1.7 or an OM 17/1.2 with an OM 17/1.8. A f2.5 FF lens provides about the same light gathering and subject isolation as a f1.2 MFT lens with the same angle of view (because the entry pupil is the same diameter and you are the same distance from the subject). MFT has the advantage that low light AF depends on f-stop, so shooting at f2.8 for MFT beats f5.6 for FF.

Shot with a Viltrox 35/1.2 LAB FE lens
There is no 17/0.6 MFT lens, so the shot above required an FF body. The Viltrox cost me £770 new discounted, a used OM 17/1.2 Like New from mpb is currently £499 or discounted to £1,099 new. The Viltrox is 910g and the OM 390g.
Diffraction depends on depth of field, so it's the same photographically for any sensor size whatever misleading comments people make about MFT providing greater DoF (apart from that point about low light AF).
TL

R There is no magic that makes FF always photographically better than MFT in any way that matters. You need to compare use cases against specific gear to make choices, in my case every time I pack my bag.
Hope that helps.
A
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Infinite are the arguments of mages. Truth is a jewel with many facets. Ursula K LeGuin
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