The Pyra does not have a smartphone form factor. As interested as I am in this project since a long time (and the Neo900, but this will be much more compact), I do not think that Chenliangchen meant that kind of form factor when he said that it would be hard to produce a compact device. He was rather referring to 4.5" smartphones versus nowadays smartphone sizes (more than 4.5"), as this is what people - myself included - asked him here when they mentioned the N9 and the first Jolla device.

To my understanding, Chenliangchen aims at taking advantage of the most widespread (or easily available) Sailfish-compatible parts to produce a smartphone with a hardware keyboard, namely using his experience with the sliding keyboard for the Moto Z. While this won't be compact per se compared to a full-touch smartphone made of the same parts, I think what he has in mind is of a totally different scale than the Pyra.

But then, since I actually feel the hype flowing in my veins every time he mentions this project, I'd prefer him to confirm himself and post more details while he's at it.