For several years I’ve hosted in the “middle ground” sense described by the OP, running my own incoming mail server and relaying outgoing mail through a big provider.
The main benefit for me (compared to using a big provider with my own domain) is personal privacy. When I used Google for mail, Google had access to so many pieces that make up my personal life: Purchase receipts. Flight itineraries. Conference registrations. Emails from my university. Emails from my realtor. Utility bills. Notifications for subscribed forum threads, GitHub repositories, Wikipedia pages. Whatever newsletters I chose to subscribe to. Theoretical access to any site with password reset by email. Running my own MX eliminates Google’s access to most of these things.
There are other some other benefits too. Free infinite aliases I can use to sign up on any website. No fear of dependence on features that might get paywalled. No sudden danger of having to migrate data to another provider.
> If you're spending more than an hour a year maintaining your self hosted email (which you will, big time!) then your Google Workspace / O365 is paid for.
Reducing my data footprint is something I care about enough to spend my spare time on.