> But, what distributing some of the components into so-called microservices would give you is a graceful failure scenario where even if all the instances of a specific component fail, the rest of the application still works. Maybe only one function stops working temporarily but most work continues on.

The important thing to note here is that microservices give you one way to build a graceful failure scenario. You don't get it for free. Often that 500 will propagate all the way back! So you have all the same failure modes + network failure modes!

You could also build a monolith that could handle component level failures, for that matter. Tooling doesn't seem to be as common, though.