Yes, your approach can work. Fusion is overall quite a bit more powerful now than it was in the MMF2 days, and a game like I Wanna Be the Guy is well within the abilities of the engine. Since you're developing with only PC in mind, performance should be even less of an issue.
If I'm understanding you correctly, it sounds like you want to have one very large level frame and build every one of the 50 levels inside of it. When the player switches to another 'level' they would simply teleport to another part of the frame where the next level is located? I don't have any experience with doing it that way in Fusion, although it is technically possible. That being said, I think you could run into some issues doing it this way if you end up needing too many objects loaded at once, or if you make a lot of really large objects or the frame ends up being absolutely massive in dimensions. The max number of active objects in a single frame at any given time is 30,000.
Usually the practice of loading all of your levels in a single frame is done to avoid the clutter that having something like 50 individual level frames would cause, along with the difficulty of keeping track of the events for each of those frames.
There's another way of doing a game in which you use only 1 frame for all the levels, but in which you do not load them all at the same time. With this method, you would have a single blank frame that loads 1 of any number of different levels into it one at a time from a file. When you leave the current level, the frame resets and loads up a different level. This method generally requires you to create some kind of custom level editor in which you create and save the data for each level which would then be loaded by the games single level frame. If you don't want to make a full blown custom level editor, you can still use this method by building your levels in separate frames in Fusions default frame editor and then programming a set of events to loop through all of the objects in the frame to save to a file in the same way that you would with a custom level editor. I think Volnaiskra developed a method like that if I remember correctly.