"If you're the big fish in a small pond you're not only missing out on learning from others, and creating impressive things, but ingrained cynicism and having an over-inflated sense of worth are also risks."Absolutely true.
"Fortunately having an unchallenging job can provide lots of time and energy for research and side projects that can lead to jumping into more interesting work."
You know, in theory this is true. In practice, I've been in this situation a couple of times in my career. And it sucked. Hard. It was soul crushing. It was depressing. I found myself emotionally drained at the end of every day. I would complete my work in a short timespan every morning, then somehow end up mindlessly cruising Facebook (or whatever passed for Facebook back then) throughout the day. My latent productivity plummeted in direct correlation to my plummeting mental engagement.
Maybe I'm an unusual case. But oddly enough, I find a boring, trivial, meaningless job almost more draining than a challenging and extremely fast-paced one. In the latter, at least I am revved up, and thus I have energy for side projects on the weekends.