There’s a plugin in the marketplace called … Dungeon Architect? Something like that.
It has a few algorithms implemented, and, more importantly, an “entity population” mechanism where the algorithms place abstract tags in world space, and the setup places the blueprints or meshes you suggest to populate those locations.
If you like playing with this kind of stuff, it’s pretty fun to play with, although ultimately I’m sure you’ll run into the limitations at the edges of its feature set.
When it comes to the original question: “blueprints” or “static mesh actors?” THERE IS NO DIFFERENCE! Well, there is a small storage difference, and a small instantiation difference, but once your thing is in the level, a static mesh component attached to a custom blueprint that doesn’t move, and a static mesh component attached to a static mesh actor that doesn’t move, will perform the same. And the load/instantiation time difference is minuscule.
Another thing to maybe consider would be to have a builder that uses instanced mesh components – one per “kind” of wall/floor/whatever you need, and then add all the instances to each of the actors. Requires a little bit more setup, could maybe be a bit more efficient – but in these games, it’s almost always fill rate that matters, not per-object overhead, unless you’re building your dungeon of, like, brick-sized pieces.
Blueprints have the nice property that they can randomize themselves a bit when instantiated, and they can also include things like lights and particle effects, too.
Anyway, hope that answers the question, and if you’re interested in evaluating different approaches for procedural generation, you could do worse than buying the dungeon architect plugin and picking it apart.