I used to DM in player client. We had DMFI tools and created PC/NPC's that were both for individual play and for facilitating the play of others, though mostly the latter. With the wands you had nearly the full power of a DM, sans the ability to possess or move NPC's, though you could still throw your voice with the voice widget. I remember running five separate conversations at once, four through NPC's set with the voice widget and one through my PC, and the other players thought they were talking to multiple DM possessed NPC's.

Those PC/NPC's were frozen in level and had significant plot involvement, frequently being quest givers but that would also accompany the party on the quest. It worked extremely well, but it did require a roleplay style of facilitating the game for others, a support role not the main star. As plot characters, they were immortal until chosen to die for a plot reason.
So, a hybrid is possible. Of course, on that same server members could play and DM, since it was a one server world. The PC/NPC was an option for people who preferred the player client, and they mostly functioned as DM assistants. I almost always had a DM in game with me when running my PC/NPC. But even playing the PC/NPC was not the same as just playing. I had a regular PC as well on that server, and enjoyed being able to just play without having to be a "fixer" of every problem that came up for others. So, apples, pears and pear-apples, each a very different experience.
