Ok let's examine history to determine who's correct.
35mm film vs MF film. - MF wins.
Canon 1ds vs kodak DCS MF back - MF wins. (Available on Luminous landscape)
Canon 5D2 vs Hasselblad MF backs 40MP variety - MF wins.
D800 vs IQ180 - MF wins.
D900 56MP camera vs next gen MF 120+ MP - MF will win.
This is because MF is bigger than 35mm. MF has a specific use for low ISOs and slow subjects. There is no replacement for displacement. The bigger sensor/film will always serve better in those situations.
I can only imagine what will be possible when MF will move to full CMOS tech, then you will have the pixel density of a d800 + all the advantages of MF. It's just a better tool for what it does.
Okay, that was funny!
5D Mark III, 100-400mm L, EF 70-200mm f/2.8 II, EF 24-105mm L, EF 17-40mm L, EF 85mm f/1.8 USM, Canon 580EX II, Canon 430EX II, Promaster TC 1.7x