I believe it would have been ahead of its time (actually, being bull-pup it still is ahead of some currently used assault rifles). Ammunition, while not ideal for assault rifle, was probably better than 5.56 Nato or 7.62x39. But these things are secondary importance when comparing to reliability and ergonomy. I don't know how well EM2 manages itself in these two.
Yes, reliability is maybe more important in this kind of weapon. A new weapon that's unreliable, either by design or materials (like happenend to many CETME Ls) it's of no use in the field.
Most new weapons are unreliable at first. Few remain unreliable after a few years fettling (heck, even the SA80 is reliable now!). IMO the EM-2 would STILL be a first-class weapon system today. I have handled one and the main problem was the optical sight, not a patch on the SUSAT. The only change I would seek to make would be to alter the ejection system to make it ambidextrous. As far as the 7x43 ammo is concerned, it bears a remarkable ballistic resemblance to the two US experimental rounds (6.8x43 and 6.5x39 Grendel) currently being touted as providing far better all-round performance than the 5.56x45. And it had the long-range performance to beat the 7.62x51 as well. Tony Williams: Military gun and ammunition website and discussion forum
