Assuming you had soil moisture sensors that reported some data, then ET would not be required. There’s two types of smart irrigation controllers; ET & SMS – to learn more, please see to this community post.
Yes in theory it becomes a closed loop system. Installation of the sensors is an important step that can result in good or bad data getting sent to the controller.
I haven’t seen any affordable, durable outdoor options yet, but we’re keeping a lookout for them. If you know if any, please let us know.