All else being equal, there is one 'given' in gear drives, regarding the
strength of the drive. The larger the meshed area, the stronger the
Round reels have room for larger gears, and because of factor 1
(above) they don't require as 'steep' a gear ratio. This works out to
theoretically stronger and smoother gearing in the larger diameter reel. I
say theoretically, because all else is rarely equal. Wider gears don't take
up any more space (diameter-wise) so it's easy to achieve the same amount
of meshed area with smaller gears that way.
Materials and the precision of the mesh, as well as the angles the gears
are cut on can also alter the dynamics of the gear drive.
In other words, while the diameter limitation does complicate the engineer's
ability to design the same degree of smoothness and strength into the gear
train of a low profile reel's gearing, it's nothing that can't be overcome
throwing money at it.
So if you're buying a low end reel, you're more likely to get functionally
better gears in a round reel, but once you get into the pricier stuff, the
difference probably doesn't amount to squat. Then again, it might not
amount to squat in the low end reel either, because just having the room to
make bigger gears doesn't mean the manufacturer actually took advantage
of that room.
In the end, you just need to bear in mind that a low profile reel usually
needs a slightly higher gear ratio to achieve the same retrieve rate.