Electric motors have a wide power band but it isn't infinite[1], gearing does make a difference. If I'm in a higher gear on an incline my motor has significantly less usable torque vs shifting down to a gear that's closer to the power band.

Now if that is worth the complexity/cost is a fair debate but there are mechanical advantages to mid-drive motors.

[1] https://forums.electricbikereview.com/threads/ebike-motor-po...