Hello Nagendra
As such every system will have its own drawback. You can rephrase your words and ask the same question - What is the difference in SAP ECC Vs, MDG for Customer and supplier?
On to your queries -
1) Can we create a customer or Vendor in MDG without creating the Business partner.Similar to want we do in ECC(like tcode XD01,,) - Yes...Read the MDG documentation
2) Can we integrate a custom Fiori UI with MDG solution. - Yes.
Differences -
1. MDG data model and ECC table fields - you may find difference in the MDG fields and ECC. Based on the requirement you can extend MDG data model and add those fields.
2. Customer hierarchy - Currently not available in MDG. You have to assign the customer in ECC.
Hope it clarify your doubts. Read the SAP documentation for more details.
Kiran