this feels like a pretty simple idea to implement so it may have been done before in some manner.
a good place to start with explaining this idea would be as follows
im imagining the regular steve placing a block
then a steve half his size placing a block on a quarter of a block.
then a steve twice the size of the normal steve placing a 2x2x2 block.
(new steves may need tweaking to fit the block size im not a math magician)
and maybe add one or two more sizes in each direction for ludicrous purposes
my plan with this is to have huge stevens build a huge town and small steves to build tiny little towns in the alley way of the big town. and some tiny towns would be on there own in the wild.
then some stat tweaks based on size. how long it takes to break blocks, health, dmg etc.
with speed smaller steves should outrun any larger steve but not too ridiculous per size difference.
would also need to find a way to automatically resize items based on steve size. or maybe make copies of them for each size which require that size to use.
maybe some mobs spawn in different sizes. zombies and skeletons are a must. farm style animals would be awesome. villagers and their villages would be cool.
thats all that i can think of for now. some other opinions on functions and other possibilities are quite welcome.