We have been doing this successfully for many years, no problems. Some multi site installs have up to 300 sites running on them.
You have to know when to use the available technology.
Spot on. I am currently working on a project that has over 25,000 multisites running in WordPress Multisite. The amazing thing besides the sheer number is WordPress has not been a problem, throw it on AWS and the scaling issues are solved. People who proclaim that WordPress can't scale have never built anything scalable with it.