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Seems as though there's a big difference between units that can ignore morale checks and those that can't. Will this and the detachment system lead to more small units? Those 3-man vehicle/monster units can get really screwed, hard to justify the risk. One Broadsides dies and 400 points can easily run off the table.

Well a broadside team has Ld of 8, you will always loose the leader last. So roll 1d6+2 and it's impossible to loose one without other outside involvement.
Now for larger 10+ blobs yes morale will be a thing, that combined with sergeants being "free" means we might see more MSU style play.

It's the complete opposite to how you state it. The smaller the unit, the more resistant they are to leadership tests as they have less models to lose to add to the score against them, whereas a large unit is more susceptible, because if for example they lose as many models or more than their LD value is worth, they will auto lose models to the roll. Large units suffer (without special rules for leadership), MSU gains.

I found War Walkers nearly immune to morale (LD8). If I lose 2 War Walkers, I still auto pass Morale. It's whole models lost, not number of wounds lost that matters.

Big units will be harder to manage with Morale. I had to find something to prevent my larger units from running away (Guardians). I added the Avatar which provides a bubble to make units immune. I think multiple armies will have some type of similar mechanic to assist with this.

Poly, I think you are confirming what I said, not contradicting. Though it looks like most 3-model units have high enough ld to ignore morale losses, MSU is only counteracted by the No Mercy mish.

Ah right ok. Got a tad confused with how you stated it. Yeh 3 model units will mostly be moral resistant aside from the off leadership rebuff.

While that is one thing pushing for MSU along with more upgrades and special weapons, there are things pushing the other way.

Mostly in the matched play missions. A whole lot of objectives involve killing enemy units. If you get D3 points for killing three enemy units of type X, it's it easier to do so against five man units or ten man units? Even twenty person units were no morale bonus and relatively low leadership take more killing.

Similarly with expensive tough models. Much harder to score VPs off of.