I submit that larger families give children more opportunities to get their emotional needs met. Without any siblings, a child is totally dependent upon parental attention and love. With enough siblings, there is genuine love and attention all around.
Sometimes. Depends on the family dynamics. In the old days, it would be that way since mom and dad, and even grandma and grandpa, were home. But a sibling doesn’t take the place of an absent parent, unless they are a parent-figure (much older and one the child bonded to as an infant.)
Besides to create a true narcissist would take more than just busy parents - they’d need to be narcissists themselves or addicts, or both. Something with major psychological damage.