I'll go along with some of this... Here are some notes.
Once you get a displacement hull to hull speed, increases in power will provide diminishing returns as far as speed, but that energy will transfer into higher amplitude bow and stern waves. The waterline length holds the wave at a fixed wavelength, which can't go any faster through the water. Inputting more power thus causes increase of amplitude of bow and stern wave. In large ships, this can lead to unsupported areas amidships, and possible hull damage (this info from Chapmans.)
You are probably right, that the small outboard prop probably won't cavitate. However, I will stand behind my assertion that a high thrust prop of larger diameter, higher surface area blades, and lower pitch will provide benefits to a displacement hull. I will also agree that if a 5 or 6 hp motor will get a 21 foot displacement hull to hull speed at less than WOT, a 9.9hp won't help you much. If your motor can't get you to hull speed at WOT when you are bucking a strong wind, then in that case a higher HP motor probably can, since it may be spec'd with a different pitch prop (but, in these small sizes, probably not a bigger diameter prop.) Less pitch will allow RPM to build more quickly and provide more pushing power, but less high end speed.
I disagree that more horsepower will help bucking a current, because we will be talking about hull speed through the water. If your boat has a max hull speed of 5 knots, it will be awfully hard to buck a current of 5 knots. The energy of the current and the outboard will still be trying to move the boat through the water at 5 knots (even if speed over land was 0,) creating the bow and stern wavelength dependent on the waterline length. Increasing power to marginally increase speed over land will also increase wave amplitude while not materially increasing wave speed. Therefore, I feel it's easier for more HP to overcome windage than current.
I will also agree that a larger diameter prop can make for more vibration. I can feel a thum-thum-thum vibration with a high thrust prop that was not there with the speed prop. I can't say this is caused by the blade tips on the larger diameter high thrust being closer to the anti-ventilation plate, or the shape of the elephant ear blades, or what... My guess is that a blade tip vortex is now close enough to vibrate against the anti-ventilation plate...
Also, I think the typical spec prop will have increased blade rake. This has the effect of lifting the bow, which I don't feel is desirable in a displacement hull. The Evinrude doc referenced blow states this is desirable in a smaller planing hull to lift the bow and reduce drag from wetted surface area. My high thrust prop definitely has less rake.
There is a lot of info on pitch, rake, etc. in this Evinrude prop document. http://www.evinrude.com/Content/Pdf/en-US/propeller_selection_guide_767064.pdf#zoom=100 (I'm using this Evinrude doc because I had looked them up regarding previous posts discussing the Bombardier purchase of OMC, and the killing off of the Johnson brand in 2007.)
I still stand by my assertion that most smaller outboards are spec'd and intended for planing hull boats, like lightweight aluminum fishing boats. Our displacement sailboats will benefit from lower pitch, larger diameter, bigger blade area, less rake, and higher RPMs into optimal operating ranges. (Optimal operating ranges can see benefits in cleaner burning spark plugs with less fouling.)
One thing I have learned, regardless of prop pitch, is that many novice helmsmen find the boat moves too fast at idle, and they come in to the dock too hot. There is an easy way to control this with motors that have transmissions: shifting into neutral, and forward for bursts of power, will keep speeds at manageable levels. I've taught several people this technique, as my Grandfather taught me, and they find it makes docking so much easier than coming in mach 5 with their hair on fire...
or at least too fast at idle 
