I wouldn't hate it, is definitely more interesting than just giving him and Stg or G43. It's also annoying that he carries a close range weapon because his squadmates carry Ober Kar98ks, so your ideal range to engage at is long.
I’m actually a big fan of officer and squad leader characters using short range weapons in an otherwise longer range oriented squad, like USF Lieutenant and Captains. I think it’s more realistic as very few units issued SMGs to whole units except highly specialized teams, while almost every warring nation issued squad leaders some sort of SMG to supplement the units close range firepower while on the assault or while defending from an assault.
For example, a Sturm Officer with an MP40 contributes little at long range while his bodyguards do the long range fighting. The Obers in his squad chip away at a charging CQB squad, weakening them enough that the officer can fend them off with his SMG if they do close the distance, but he doesn’t pack enough of a punch to be considered a full blown CQB squad himself.
This is how I think the veteran squad leader for WM Grenadiers should work too, a long range squad with enhanced close range defensive capabilities.