The USB-A ports serve a purpose; they make adding a wide selection of wireless keyboards and mice with a USB receiver (I like Bluetooth, but the receiver-based are popular), and one of the benefits of the Mini originally was that it could be used with peripherals many people already had lying around (which also includes those old USB-A thumb drives). A USB-C keyboard and mouse might charge faster, I imagine, but otherwise making them USB-C adds nothing for most people.
I imagine wireless will be all the more popular if it's very small, light and slides around easily - so wired keyboards and mice might move a tiny Mac Mini around.
Notebook users may be somewhat used to dongles, adapters and hubs; desktop users are less so. Adding these could easily more than defeat any size reduction in the Mini itself. If a smaller Mini has significantly reduced ports of whatever types, I imagine many users will buy hubs or docks to add ports just as some Mac notebook users do...which will reverse the benefit of lower material usage and packaging for the Mini itself.
On the issue of desirability of miniaturization 'because they can,' yes, for applications like packing a number of them into a small space (e.g.: a rack) it might be nice, but what % of the Mac Mini market is that relevant for? If really small, it may slide around easily (not a huge issue, but irksome to some).
Another downside of a tiny Mini is it would fit easily into a coat pocket, small bag, etc... Workplace theft could be a problem. If small and unobtrusive is the minimalist goal, I can imagine one with a Kensington port cable securing it to the desk.
The idea came up of a 'mini-Mini' one could stick to the back of a monitor, all the better if powered by USB-C PD since a very short Thunderbolt cable to a Thunderbolt monitor and BAM, DIY iMac (with option for non-Apple monitor!). Yeah, but from the side or rear that thing will look like a robo-parasite on the monitor. People will do it, but I doubt Apple will push it. And the ports back there will be inconvenient (like my iMac's).
While we may debate the desirability of reducing the size, this is already modeled for us in the PC world - there are 'nano' PCs, small/medium tower units and large towers. Perhaps things have changed; I've historically thought the nanos were a small niche in the market, and most people chose larger desktops (if they didn't opt for notebooks), and the option to add in HDD, SSD, RAM and PCI graphics cards was a big draw (though Apple, and I think the new Snapdragon ARM-based PCs, take RAM and non-integrated graphics expansion off the table).
Since PC users have a lot more choice, how many opt for the tiniest PC possible? What do the people who have cost-effective choices do?
The question becomes, is the Mini a headless (and keyboard less) notebook or desktop? Functionally, it appears to be the former.
