For you first two questions: Spotify will work with Bluetooth, and WhatsApp will have eventual notifications (real-time if the app was recently opened, up to seven hours later otherwise, at least on my device)
Sure, "a bit", but I don't think a phone that is entirely broken except for a few open source apps that don't do useful day-to-day things (like order me a Lyft, let me do my banking, pay for stuff at a cash register, navigation, etc.) is all that useful.
My ideal would be to have a base OS and core standard library that I can trust, and then I get to choose what apps I run on top of that. Sometimes I will choose to install an app that doesn't have a great privacy track record, but I will rely on apps like TrackerControl, Blokada, and Bouncer to mitigate my exposure somewhat. It won't be perfect, but we don't live in a perfect world where there are feature-identical, privacy-respecting clones of the mainstream apps. Until that time, I can decide what are acceptable risks to my privacy.
Unfortunately, I don't have that choice right now: either I live with the privacy minefield that is Android (as I do, and try to mitigate privacy leaks as well as possible), or the nanny state that is iOS (which I -- for now -- consider the greater evil).
We've sent some patches to microG to address them at https://github.com/microg/GmsCore/pull/1483
I'm running it on my device since a few weeks now and it has been quite reliable so far.