It works for us to some extent, but there are ultimately people who specialize in various areas. Nobody can be a true master of absolutely every area in a large system with enough knowledge queued up to be able to be an independent power player. And I think that's reasonable to anybody who works in or near the trenches.

It should be expected that any member of a full stack team can figure out how to do any particular task, but it's a waste of resources not to have people lean on teammates who have more recent deep experience in a particular area.

This goes for both technical areas as well as domains. If my teammate just spent a couple of weeks adding a feature that makes heavy use of, I dunno, database callbacks in the user authentication area, and I just picked up a task to fix a bug in that same area, I have two choices. I can consult with my teammate and get their take on what I'm doing and have them preemptively point out any areas of risk/hidden complexity. Or, I can just blunder into that area and spend my own couple of weeks getting properly ramped up so I can be confident I made the right change and didn't introduce a subtle regression or performance issue.

As the number of tech and domain concerns increases, it becomes more and more important for people to collaborate intelligently.

My team oscillates between 4 and 6 developers and this has been our practice with pretty high success. Quality is high (when measuring our ability to deliver within our initial estimates and our bug count), morale is good, and everyone is still learning with minimal frustration.

I think the issue of team cohesion comes into play if people are all independent and also stop talking. If I take the couple of weeks in my previous example instead of talking to my teammate for some knowledge transfer, I'm disincentivized from leaving my personal bubble at all. I'm also less likely to stay within overall software patterns if I think I'm always trailblazing. The first time you write new code, you've established a pattern. The first time someone repeats what you did, they've cemented that pattern. That's often a nasty double edged sword, but I generally lean toward consistency rather than one-off "brilliant" code.

Where this can start to break down is when people become pigeonholed in a certain role. "Oh, you're the CSS guy, so why don't you take this styling ticket?" and "Kevin, you do all the database migrations so here's another one" are great ways to damage morale and increase risk if someone leaves.

Tl;dr: everyone should be able to pick up any task, and they should endeavor to keep their axe sharp in every conceivable area, but it needs to be carefully offset against wasting time by refusing to lean on other people.

As with most things, it's usually a matter of personalities and not policies.