is this BS?

You might not be able to increase power beyond a certain point because MG1 is rated to 42 kW and MG2 is rated to 60 kW, the difference being battery power.

Only at higher speeds might you notice more torque. At lower speeds MG2 is providing a majority of the torque and it has not much to do with how much power the ICE is producing.

At lower speeds MG2 is constrained in power because it is running at maximum torque, and the wheels aren't spinning fast enough.

If the ICE did produce too much power for MG2 to use, it would briefly shunt power to the battery. The ECU would then adjust quickly to reduce the power the ICE produces.

At higher speeds a greater fraction of the power the ICE produces goes directly to the wheels, as opposed to the electrical path, and then you might experience more acceleration. This is due to how the power is split within the power split device.