It is, and D'Argens comes across vividly and very well in it. For another very likable take on the Marquis, see Casanova's memoirs (he met him after D'Argens had returned to France), as quoted here.

But yeah, the precariousness of living as a Jew comes through very clearly, and the prevalence of "that's just the law / how it's done" even among people who are themselves very much pro-enlightenment. Your addendum on the other hand emphasizes why I feel like this was such a missed chance, because it's not like Fritz' principles wouldn't have allowed him to take the necessary steps.

Heinrich Heine: And this is why I'm anti-Prussian, and my despot of choice to fanboy is Napoleon. Vive l'Empereur!

cahn and mildred_of_midgard, the Code Napoleon, which became the foundation of German state laws during the time Napoleon was more or less boss of continental Europe, did abolish these restrictions for Jews, and young Harry Heine from Düsseldorf was directly affected by this. By the time he was an adult who needed a job, otoh, Napoleon was gone and several of those restrictions were back (though thankfully not the Schutzjuden-ones). Heine had a life long soft spot for Napoleon, larger than any freedom-loving poet should have. And his instense dislike of all things Prussian leads to some hilarious verses in Deutschland: Ein Wintermärchen, among other works.

Back to the Marquis D'Argens: in addition to being friends with Mendelsohn and Raphael, he also employed a Jewish secretary for a while, Aaron Salomon Gumpertz.