>>Different things work better at different scales.<<

I get that, it's just that I usually see folks assuming that larger/smaller sizes are the same. Very rarely do we see the giant complaining that his feet keep going numb, or the Lilliputian who has to eat 2x their weight in food per day.

And more than biology: how would intelligent shrews cook food without burning themselves, even if they could avoid starving to death while cooking?

>>I was intrigued by the idea that on this scale, vertebrates aren't competing against other vertebrates, they're competing against insects and other invertebrates. <<

I suspect that something similar might have happened in the primordial swamps filled with man-sized bugs and gator-sized salamanders...

>>It also makes me wonder if a shrinking vertebrate might dispense with part or all of the skeleton, or adapt to use something different. <<

Probably, but it would take a long time. And I'd wonder how a 'jellybrate' would rearrange the muscles/muscle attachments; and how it would protect its spinal cord. I'd also wonder what (if anything) they'd use for a skeletal system - keratin fibres? Hydroskeleton?

I doubt it would work in real life, but imagine in a fantasy setting, the teensiest tiniest of frogs, that uses a hydroskeleton, and can freeze-unfreeze parts of its skeleton at will. Instant spines! Can squeeze through small spaces! I bet they'd be fascinating tank pets - but probably not without some very good insulation...