So yes, the reason I called it unrealistic is because of what you mention in the rest of your post: scientific knowledge and technology is essentially guaranteed to spread between societies that are in any sort of contact. So a 100.000 scientists in a single "state", aren't necessarily more productive than those same scientist divided into 20 "states". And yes, I do believe that technology spread in a Stellaris-like Galaxy would be similar to technology spread on earth, considering the ease of FTL travel and communication displayed. Just look at pop migration, envoys, foreign Leaders, etc. Even just knowing a technology is definitely
possible (because you've seen others use it) would accelerate your own research.
So, considering that large empires having an enormous advantage over smaller empires in technology is unrealistic, unbalanced and unfun, there are two options:
- An extensive rework of the research system along the lines of the options you describe.
- Keep the Empire Size penalties (and probably make them harder/impossible to reduce/remove)