Is there a chance we can have a 'lite' version of this submodule too? that allows simulation (RTL and GL) but doesn't include things like GDS and openlane runs?

This is a real need to be honest @User. We want to be able to simply run RTL simulations to validate the user project area after booting the SoC.

As a stop gap you can use mpw3 caravel, that works. As far as I can tell the interface is the same. But effort you spend on firmware will be somewhat wasted as the processor will change in mpw5