Yes. The result being an IL stabilized 14-42 lens, with full zoom control. With the flip diopter you should have a slightly better setup as the Oly 12-50 is not stabilized and no other mid-zoom lenses allow for manual focus (behind a flat port).
I accidentally ended up in Raja Ampat with all my camera gear except the Nauticam lens gears for the 7-14mm and the 14-42PZ lenses. Focus was not a problem as I use the AFL lever for most shots anyway. For the 7-14mm, I just left it set at 8mm and that was fine for most WA shots. For the 14-42PZ lens in the flat port, I remembered this thread and set the Fn1 button to zoom control. Worked just fine for all the macro shots. Thanks guys!