Basically, there's a few different tiers in terms of underwater setups:
Tier 1 (under ~$1000) - GoPro 7 / Olympus TG5
GoPro 7 + housing - if shooting only video. Terrible for stills, no option to use strobes.
Olympus TG5 + housing + wet wide angle lens like bakscatter m52 lens. Great for macro on its own, can take decent wide angle images with a wet lens. A good starting point for most people who want to get into underwater photography and not monstrous to travel with. Main limitation for me isn't the sensor size, because image quality is really good enough at ISO 100 for anyone who isn't printing poster. Rather, it's the lack of a full manual mode, which can be frustrating once you start introducing strobes and doing balanced light wide angle photography. You can kind of work around this limitation by using aperture priority mode, fixing the iso and then using exposure compensation to indirectly control the shutter speed, but it's not a perfect workaround. If the TG6 introduces a full manual mode, I would strongly consider owning one of these cameras even as a professional. The macro mode is great!
Tier 2 (around ~$3000) - Sony RX100 or Canon G7X II or Panasonic LX 100 1" sensor compact + wet wide angle lens and wet macro diopeter
The main advantage over a TG5 for me here is the full manual control. Image quality is better as well, but honestly, I think the TG5 is good enough for most people as far as image quality is concerned. But the tradeoff is that now you need a wet diopeter lens to do macro, and the macro magnification isn't as good as what you could achieve out of the box with a TG5. You're also looking at 3 times the cost once you factor in an aluminium housing and a good wet wide angle lens like the Nauticam WWL-1.
Tier 3 (~$6000) m4/3 Mirrorless Cameras like Olympus EM1 Mark II or Panasonic GH5
The big step up here from the 1" sensor compacts is the ability to use interchangeable lenses. m4/3 has a great lens selection, with everything from 180* fisheye lenses, to kit lens + WWL-1 wet lens for wide angle, wide angle lenses behind a dome port (mainly only consider if you do a lot of split shots, otherwise the WWL-1 route is a better option) to dedicated macro lenses that can get you 2:1 magnification without any diopters. Image quality isn't actually a huge improvement over the 1" sensor compacts, but ergonomics on the housings are better. For video, I consider m4/3 to be the sweet spot atm. For photos, there's an argument to be made that some of the cameras in Tier 4 offer sufficient improments in image quality, autofocus and lens selection to make them worth considering.
Tier 4 ($8000+) - APS-C or Full Frame DSLRs/Mirrorless Cameras
Main advantages here over m4/3s are:
* better autofocus systems (mainly in the the Nikon d500/d850/d5 line);
* access to versatile fisheye zooms like the Tokina 10-17;
* significantly higher resolution and IQ with the 40-50Mpix sensors
* optical viewfinders (which are easier to compose high-contrast wide angle shots with than EVFs, in my view)
But there's some real disadvantages as well:
* depth of field for macro is shallower than with m4/3 cameras, and you get less magnification without external lenses
* if you use wide angle rectilinear lenses behind a dome port, you need a 230mm dome port for the best results, and these are huge, heavy and expensive
* the WACP wet wide angle solution is very heavy and very expensive also, when compared to the WWL-1 you can use on m4/3
* heavier and bulkier for transport, even though the whole overall rig might be similar in size in the water
It's worth also considering that a lot of the perceived quality improvements underwater come from your lighting (strobes) and getting closer, not so much from the camera sensor size or even the quality of the optics. And once you add two strobes, a tray, arms and a wet wide angle lens, even a TG5 rig gets quite big and bulky. I wouldn't say there's a meaningful difference in size between a compact, m4/3, or even a full-frame camera once you add arms and strobes. At least, not if you stay away from 230mm dome ports and use fisheye lenses with smaller dome ports or wet lenses for wide angle.