The biggest issue with these type of mechanics is how quickly they shift from being interesting and dynamic to frustrating and uncontrollable.
This is a big strike against Democratic governments in Stellaris as it is. I know my leaders give solid empire-wide bonuses, and I know which of those bonuses I would like to have. But as Democratic not only will my bonuses be weaker and harder to obtain (mandates vs agendas), they will also be harder to control. This fits RP-wise, but it can be extremely frustrating in practice. Even if I influence the election, every 10 years I have to worry about losing a random scientist or governor I was relying on. At some point, I stop even trying. It makes sense that I would have very little control over this, but it's just. not. fun.
Factions are very similar. Outside of my starting ethics, I only have a small amount of control over which ones form. Again, this makes sense. The problem is that the mechanics for additional factions forming are not well explained, and many of the factors involved do not influence factions in exactly the ways you would expect. Did you know that having the Strong trait makes your pops more likely to be Militarist and thus increase the chances of having a Militarist faction form? That any pops with the Repugnant trait on a planet make other pops there more likely to turn into Xenophobes? That certain diplomatic treaties with Materialist or Spiritualist empires make it more likely for your pops to shift to those ethics as well? For most of the almost 1000 hours I've played this game, I had no idea.
Say you're like I was and want to play as gentle giants that embrace their inner zen - you choose Pacifist Spiritualists who are Strong and Natural Sociologists. Maybe you even choose a Democratic government. Early on, you meet some Materialists that want to be friends, so you oblige. Before too long you have very angry Militarist and Materialist factions, and you have no idea why. Somehow the leader of one of these factions becomes president and now that faction is boosted even further. It's a disaster. Well, okay maybe not a complete disaster, but it's at least very annoying.
Who among us would figure out that this wasn't actually completely random, but affected significantly by their own choices? The only reason I eventually dug into it was because there seemed to be a very high frequency of Spiritualist factions forming in my Materialist empires, and I couldn't understand why.
But whether or not you figure out what's going on behind the scenes, it's going to change your playstyle. Over time you're probably going to trend toward the options that - while not always fitting for RP reasons - offer much more enjoyable gameplay patterns.
Hate having your best scientist turn into your worst leader? Stop picking Democratic.
Annoyed by factions? Play gestalt, or aim for synth ascension so you can largely ignore them.
That's the thing. Even when mechanics like ethics attraction actually work, the ideal gameplay loop just becomes 'find a way to make most of my pops the same ethics so I can minimize the faction tab and never think about it again'.