Yes the mid-drive motor turns at pedaling cadence, but can take advantage of the derailleur (or IGH hub) gearing to maintain low torque and higher cadence at the pedals. If a mid-drive e-bike is set up to torque up hills in highest gear without much pedal assist, that motor is stronger than need be.

Regarding smaller wheels, whether it's a mid drive or hub motor, smaller wheels help, because you need less motor drive torque for the same ground thrust, assuming the same transmission gearing. On this particular 16"/349 wheel bike, usually the problem is not a low enough gear (although it bugs me that Bromptons typically came with a low 30s inch low gear and near-racer high, when low 20s would be better). It's the high gear requirements that usually necessitate an IGH rear hub for overdrive, or smaller than 11 high cog, or way larger than 52 chainring. These days, cogs smaller than 11 are more common, to avoid the IGH, which this bike appears to have done, or just like Brompton, biased the gears to the higher end, and rely on the E-drive to climb the hills with an inadequate low manual gearing. Me, if I got an e-bike, I'd still want gearing that I can make it home with, or go without electric drive on a good day.