You're somewhat right, the best thing about M5 is the range of the quad, really fearsome one, but that's why it's in full t3.
As for other things the armour doesnt change much because russians still have nothing non-doctrinal than zis and nades to kill 251 in t1-t2 and those have much better penetration than even 28 armour.
Germans on the other hand can kill M5 with 222 for example and it's quite easy to be done in fact, there are also pgs with shrecks, superior at guns and the thing that going M5 first instead of T-34 is really risky, and if you produce it after a tank there is no window for it.
And lastly the damage, hmm you know flammenwerfer has not only longer bursts and superior accurancy but also AoE, that multiplies damage somewhat I believe, if the weapon is weaker it should be cheaper, not show up earlier, but in that case the cost should be the same as it is.
