> Sure, you could dump all the documentation into context for code generation, but that often requires more context than interacting with an MCP tool.

MCP works exactly that way: you dump documentation into the context. That's how the LLM knows how to call your tool. Even for custom stuff I noticed that giving the LLM things to work with that it knows (eg: python, javascript, bash) beats it using MCP tool calling, and in some ways it wastes less context.

YMMV, but I found the limit of tools available to be <15 with sonnet4. That's a super low amount. Basically the official playwright MCP alone is enough to fully exhaust your available tool space.