With the current in-game power system, the main reason why people use docked reactors, is to bypass the softcap limit that is set per entity. It gives you more favorable power production per block by spreading it out over multiple entities. Anyone that doesn't do this, such as just sticking with a single big ship, will be at a severe disadvantage.
This is only one of the reasons for building modular ships. Power systems account for ~1% of ship mass even if it's auxilliary power past the soft cap, so the benefit has more to do with avoiding the exploding interior than raw mass benefit, which while there, isn't all that significant.
At the same time modular designs have to include more capacitors for lag compensation and are notoriously vulnerable to EMP damage. Consider two ships; a single entity ship with 5 mil power generation and 20 mil capacity vs a modular ship with 3 entities of 1.8 mil power generation and 8 mil capacity.
Shooting at the ships with 2mil EMP damage will cause the regular ship to cut jammers/propulsion a bit but it remains able to fight.
The modular ship will take a 2mil damage to its external entity which doesn't have enough power to fully compensate even if there's no consumption on the entity, but if there is you have no direct control over it, so either your ship is required to have some security measure in place that cuts power draw when your ship is hit with emp damage, requiring more capacity to detect abnormal power drain since it'll drop naturally with normal use, but then your entity is already near depletion so it's outtaged in seconds anyway and you probably wanted that entity active, so you don't have an option for what systems you're cutting power to; it has to be the external entity first. On top of that, if the security is manually controlled you have to make the switch in advance since you wont have time to respond before you're already disabled.
Once that's outtaged, the second entity in the docking chain now has to absorb the incoming 2mil emp in addition to the power drain coming from the first entity. If you have security measures that will typically be zero, but then you're still faced with the 2mil emp draining your entity. If you do not have security measures there's now 4 million drain on a 2mil generation entity and it's disabled in 2 seconds.
Then moving on to the final entity which you can assume to be drives scanners and jammer your ship is unable to shoot and there's no way to compensate for the EMP damage, leaving your ship completely disabled with no way to recover without outside help.
The big ticket benefit for modular ships is the cost in defensive effects and scanners, which depends on the size of the entity they're placed on. Take a basic ship setup like 15% mass in weapons, 20% in shields, 15% thrust and power 20% armor and 30% scanner and passive effects. If you split this ship into seperate entities for shields, thrust, weapons and armor, the scanner and passive effects can be cut to 80% of their original mass; take 20% of 30% and you get 6%, leaving us 24% extra mass we can use wherever we want, allowing us to
DOUBLE the ships weapon or shields systems, effectively making the ship twice as strong.
THIS is what makes modular ships so much stronger, not power!
Aside from this there's also the benefit to docked armor, since it allows you to protect the ship's shield generation under the armor, aside from bugs making the ship immune to stop/pull/push effects.
And finally, which also gets ignored here, by having your thrust/scanner/jammer on a seperate entity, you can make this drive entity much more agile because turn speed is based on size rather than total mass like thrust is. By keeping the drive a small dense box your ship gets much faster turn rates, once again at zero cost.
While the new suggestion does get rid of the mass benefit from passive effects, it's by forcibly removing players access to the exploit, not removing the exploit as you should; now every time you add a new system to the game you risk reopening pandoras box; like what's going to happen if you implement magnetic docking or an alternative power system?
And you still have the docked armor and turn rate advantages but i'm sure you can work those out.