No I don't think an XREF can be scaled - or exploded into lines.
Placing an external drawing is the same as using the Drawing tool.
It will place a frame with the DWG in in and it can be resized - but only proportionally horizontally and vertically.
It can not be stretched in one direction only.
It will act as one element but can be exploded into separate lines.
It will not pollute your file with other attributes (i.e. layers - although it still has layers in the drawing settings) until you explode it and then you have an option to create them or not.
Importing Blocks I believe will just import the blocks (objects) from the DWG and place them in the embedded library as objects.
You can open a DWG as an object and this will create a GDL object of the DWG, which can be stretched in one direction only.
This can be exploded into lines.
You can also Merge a DWG.
It will become lines instantly and will pollute your file with attributes.
Yes there are many ways to skin a cat.
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