Einstein's resolution was that spacetime is warped so that free falling masses are following Newton's first law (they keep going in a straight line) as best they can in warped spacetime (they follow geodesics). For the equivalence to break there would have to be a different warping of spacetime for different masses starting out on the same geodesic.
As I see it, a more interesting question would be: if intertia is resistance to the gravitional field
of the universe as a whole (Mach, Lense Thirring), then is there even any meaning to the quesion "what if G changed?" ?