I was introduced to mbeddr back in 2010, in a SPLASH tutorial by Markus Voelter, before it even had a name. Impressive indeed.
As for MPS, I owe it the most significant breakthrough in my research, as it made me understand what projectional editing is, and how it can be used for a programming language. That was back in 2005. After it was officially released in 2009, I did some work comparing it to my own projectional editing solution (the Cedalion programming language).
My impression of it is mixed. On the one hand, one can notice the amount of investment made in making projectional editing as smooth as it can be, with some use-cases being almost as fluent as writing Java code in e.g., Eclipse. On the other hand (and this is where I can relate to your frustration), I felt it was too rigid at times. I don't remember a concrete example, but I think it would not allow me to use things that are not (yet) properly defined. I remember some "chicken and egg" problems, especially when editing Java code. It would get into a point where I needed to think really hard how to work around MPS...
I think it is a good thing that there is something such as MPS (and that it is mostly opensource), but I wouldn't use it for my next software project. Actually, I've known MPS for 8 years now, and repeatedly chose not to use it for any the software projects I started since.
P.S., I think Markus Voelter, the original author of mbeddr, is the best thing that ever happened to MPS (is he the colleague you mentioned?). Aside from mbeddr, he developed a tool that allows MPS code to be version-controlled over GIT, and takes every opportunity to give talks about MPS and the cool things he has done with it. If you look for academic papers about MPS you will find mostly ones authored (or co-authored) by Voelter.