Is there a way to modify a mesh with World Position Offset and get also a proper complex collision for that modified mesh?
Unfortunately not since it would have to run the vertex shader on the cpu which is too expensive. However in certain situations you can hack around this by applying the same vertex shader to bullet impacts etc. It gets a bit hairy then when trying to match a bunch of potentially different vertex shaders. It helps with the vertex shader math is in generic world coordinates.
Or if you have ocean waves, you can use the same sine wave math in blueprints to give boats buoyancy matching the waves etc.