The lighted neutrals and Red Cross GWX ships are still there after installing MFM. I've seen quite a few, particularly in the North Sea during '39 and '40 (it's really aggravating to pursue interception of an RDF or hydrophone contact for hours, especially in bad weather, and then find those dratted nav lights and spot lights on the flag, shining brightly in the distance!).
Ah...but beware...MFM ships that have neutral hull markings but are not flying a corresponding neutral flag can, in fact, be neutrals and will cost you renown for sinking them. It's happened to me a couple of times...always a Norwegian ship crossing the North Sea heading home from Britain before April '40, (I wonder if IABL scripted them as little "Easter eggs"?) but I'd suspect there are others to challenge the "cruel" Kaleuns and reward the "chivalrous" ones!