Hi, as far as I know unreal engine uses some auto instancing since 4.22 4.22 runtime auto instancing question - Rendering - Unreal Engine Forums
And the video where one of the devs talks about that Refactoring the Mesh Drawing Pipeline for Unreal Engine 4.22 | GDC 2019 | Unreal Engine - YouTube
What you’re talking about is a texture atlas, you can sure use that in unreal engine but I never made them by hand only used them in hlod.
But I would not use an 8k texture cause this will stay in your memory for as long as you see one mesh with this texture applied.
To further reduce drawcalls I use either instanced static meshes when I have many meshes of the same type (grass, trees, …) or build hlod when I have many different meshes in close proximity (interior of a house) and don’t wanna use level streaming to stream them out (you might wanna try actor merging instead of hlod but never used that, so I don’t know about it).