Should I be buying more expensive small parts kits? Or is this a little over blown. If so any recommendations?
I do not plan on changing my M&P Sport II rifle, but I have a slow build project going on the side. I was going to just use a small parts kit from Palmetto State. Should I swap it out for better hardware? Is that really more important than the actual lower or upper?
One would think that a PSA small parts kit would be created from the products/items they use to build their own PA-15 line, so they should be up to par for your build. I watched the same video and my take was to avoid the real CHEAP stuff to save a few pennies.
Get the PSA kit with the EPT.
Enhanced Polished Trigger.
It’s not much more money, but it’s a lot better trigger than the Freedom series basic kit.
this is reasonable. It’s hard to sift through some of this stuff. There are some picky AR guys who have the money to be picky, and then there are people like me who can afford a basic model from PSA.
Same reason I drive a Ram 1500 and not a Ford Raptor 
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It’s not overblown, but they aren’t talking about your PSA parts. The ones to be aware of are off-brand parts, or really cheap parts. If you don’t recognize the brand, DONT buy it. If the price is way outside the normal range, DONT buy it. That ziplock baggie of parts you saw at the gun show for 1/2price that the vendor says “is just as good” as the brand stuff? DONT BUY IT. Some of those folks will use inferior metals or wont take the extra step in treatment or maybe they have lax QA/QC standards.
You have the vast majority of parts made by reputable manufacturers to milspec requirements with an appropriate level of QA. Manufacturers like PSA, CMMG, Aero, Anderson, BCM, SOLGW (guy in the video), etc (there are a ton more). you can tell because they are priced almost the same. A good part will tell you the material used and how it was treated and tested.
The guy in the video is from Sons of Liberty Gun Works in Texas(?), they are known for making duty-grade “hard use” rifles. Their claim to fame is using higher than milspec whenever possible and having a very rigorous QA/QC process. I have some of their stuff and can confirm it is high-end. So his context is perhaps different from us “normies”.
Having said that, its not like the SOLGW parts kit is that much more expensive than PSA (if you can find it in stock that is).
In another thread I have a bunch of links to another forum where the guy who owns Battlefield Vegas writes about all the stuff that tends to fail on all the firearms in their stable. They brutalize their firearms by running full auto all day every day, and every part that can be broken, they have broken it. It is highly worth it, IMO, to spend a sleepy weekend afternoon and read them all 
One of the things I took away from it was yes, some of the high-end stuff lasts longer, and there 100% is such a thing as “cheap crap” that breaks instantly. But a lot of the stuff we generally consider mid-tier is actually really good. A mid-tier part may last 10k rounds and a high-end part lasts 15k rounds. But how many of us will put even 10k rounds through that rifle? If you regularly maintain and inspect your kit, you keep an eye out for wear/damage, keep a round count, and replace those parts as needed.
Is a Mercedes better than a Honda? Yes. But not everyone needs or wants a Mercedes. Everyone should avoid a Yugo.
All of the parts are important. As they note in the video, a cheap bolt catch can cripple your rifle. If the safety detent is cheap, breaks the tip, your rifle is now down.
Everyone focuses on the car engine, but if the door handle falls off you can’t even get into the car to begin with 