As a pragmatic physicist , I've always found it best not to ignore awkward things that get in the way of a definition, especially a rather restricted one.
And as such I prefer the definition in the Collins dictionary, which says " the ratio of the useful work done by a machine, engine, device, etc., to the energy supplied to it, often expressed as a percentage ". This implies that because some of the work done services the motor itself, the efficiency percentage will never reach 100% in terms of the power available at the output shaft. I would respectfully suggest that as a definition, it's of more practical use because it will indicate what's left for other use. IOW, this isn't a theoretical motor we're dealing with, but a real one.
It's all very well to talk about the motor having zero efficiency when it's stalled, but you can't do a lot of grinding like that, can you?
As for the question of adequacy for the task – then yes of course it's fine. My Exe grinder seems to work remarkably well with a motor rated at 3/4hp.