Looking at the site plans, there really is no obvious M&G area shown. There's a nook up against the Small World building, near a backstage gate, but that's about the only obvious place to put one.
This area, in general doesn't allow for very simple character entrance/exit pathways. They'd have to come from somewhere else in the land to get to this location. Otherwise, they go down a new ramp/steps and all the way back between HM and IASW show buildings.
As you said, this work serves two great purposes - a much better/larger restroom facility, and a secondary path between FL and LSq.
And to ease the pains of anyone still thinking you'll be able to see the HM show building, there's a retaining wall that comes off the back of the new restroom building. It starts at elevation 132, while the pathway is at 111, meaning a 20' tall wall and hill behind it. At the top of that hill is a water feature that appears to discharge over or under that wall, into a creek/pond.
The wall and hill taper down as you walk toward the HM courtyard.