Why do you think she woudn't be able to do the same with Star Seeds extracted? I don't get your point, why do you think that Galaxia's body was required to bring someone to life? That ability of hers was never mentioned. BTW, saved Galaxia later said that it was SM's "shining that illuminated the galaxy".
I found the ending to Stars to be far less ridiculous than the ending to the Super S arc. At least the anime made it clear that Galaxia originally was not evil and was merely being controlled. ESM's decision to save her, rather than to destroy her, was least justified. I actually found it to be slightly better than the manga's version, where Galaxia gets bodied by Chaos and kicks the bucket shortly there afterwards.