Tested it a bit, really doesn't make much of a difference. The 5th man is more useful for repairs TBH. There are 5 man flamer ass engies to compete with.
Imo 5 men assault engineers wit flamer and the possibility of BAR will be even more problematic.
Units with a high damage weapon as flamer should be limited to 4 entities because as you know their DPS drop disproportional to casualties. (Assault engineer would be better designed if they come 4 men with grease guns and the option for flamer of +1 entity 2 Thompson upgrades).
There is also the issue of doctrinal Ro.E., merging to C.E. and R.E. but at least there are some restriction in these units.