the SDK has a very thorough section on textures and asset creation and it specifically warns against using transparent backgrounds
One of my discussions on DevSupport is to blame for this section.
For additional info: this isn't saying to avoid using transparency, but to use a solid, padded background in combination with a proper Alpha channel. You also have to look out for the pixel colors at the edge of your mask (white/black matting), as they will get exaggerated over a distance in the sim as lower quality mip-maps gets swapped in, leading to hazy looking textures at a distance.
For anything flat or cross-plane, you would still set Assume Vertical Normal in MCX. In the cases of smaller vegetation, I also tend to use Fake Terrain over Standard, as it cuts down on that lighting even more. Though, I don't do this for more 3d stuff or trees, as it forces "blend" for the alpha mode, which sorts weird against the sky. I also typically don't use full PBR for my vegetation. I find that in most instances it looks better with just Albedo and (sometimes) Normal, with both Roughness and Metallic set to 0.
Though, for your hedges, I would highly recommend going 3D. As Rick mentioned, MSFS can handle a lot more geometry and drawcalls than FSX or P3D could. As long as you are using proper optimization techniques to manage quad overdraw and texture memory. LOD0 would be your full-res. Do 3 additional LODs and decimate each one 50% less than the one before it. Drop your Normal textures at LOD1, drop Comp (if used) at LOD2, and either do vertex paint or use a 64px Albedo for LOD3.
For my own hedges, I used a modified cube to get the base shape and textured that with a tiling hedge texture (I did UV unwrap the base cube and paint it in Substance to just to generate AO for a basic COMP). Then I created a small texture with a leaf on it that used an alpha mask, mapped that to a plane, duplicated, scaled, and rotated them all around until I had a nice group going, then just started duplicating that group until I covered the entire outside. You do want to find a good balance to the number of leaves and scale that you use to cover an area though, as you can get carried away quite fast and have an overly dense shrub with a ton of triangles/verts. Also, don't forget to join all the leaves to the base cube(Object Mode - Ctrl+J in Blender) before export/LOD generation, else it will treat each seperate part as a drawcall and tank performance!
For instance, mine comes out to 11,433 triangles / 22,923 verts for the 10-meter model. Double that, minus a few hundred for the 20-meter (I know, I know - I didn't feel like looking).