UE5 can make a great and efficient game actually - its more about how you use it. And because its huge and popular and accessible there are a ton of developers using it very inefficiently.

That can be true for any commodity software though. Designing something inhouse means you inherently will have engineers and experts with better low level understanding. It doesnt mean it will be better (could even be much worse) but theres a tradeoff there.

Yes. You basically still need a few engine programmers to use UE5 efficiently, even if it's not your own engine. UE5 seems to be user friendly enough that most of the game development can be carried out just by artists and game designers, but without engine programmers performance optimization will be poor.