I think the argument is that clubs should grow, within their means.
I don't think clubs should know their place and stick to that but if a club was to develop a philosophy and grow naturally then that is likely to be more enjoyable than through an artificial influx of cash.
I know there's not many examples of teams competing at the top end of the league for trophies but you could argue that's what the likes of Bournemouth, Swansea (pre-relegation), Brighton, Huddersfield etc have done. Bournemouth are probably a good example of a club punching well above their means without winning lots. Will their fans be enjoying this period more than the Man City fans? I suspect they probably will.
If i was to move down south tomorrow and got to pick a team to support that i'd go to home and away, Man City would probably be one of the last teams i'd pick. (FWIW i think i'd probably pick someone like Crystal Palace, Everton or Newcastle)