I’d like to add to this idea a bit and put it in line with blueprints. I think this could work well using a cubic plotted area. All of the work would be done at normal scale, and when finished, could be condensed into a few blocks. Chiseling would have to be limited somehow but would still like to see it incorporated (maybe limited to slope only). Textures would be shut off of course. Players would own limited amounts of mini blocks to make their mini builds and be able to purchase more with cubits or real money. The creation area would need to be controlled by a beacon, and be plotted to a specific plot resolution, such as 4X4X4. The option to reduce to mini would only be possible if the area is plotted exactly to the required resolution. If multiple mini blocks are desired, then a beacon could be placed for each one in the proper resolution. The option to condense would be in the beacon control and deplot the area in creation of the mini blocks.
I think this would work very well alongside the idea for deployable blueprints.