I'll shorten it up for you. In Oblivion (people say it was small, I had no problem with it), they fit a bigger area into a "small" game world. Now, with Skyrim, they're fitting a smaller area into that same size (presumably) game world.
Complaint about Oblivion's size: It was cramped.
With Skyrim, it won't be cramped and will feel bigger BECAUSE of that. Not only are they putting a smaller area into that same sized game world, but they have decreased the number of caves/ruins/etc, which all made Oblivion feel more cramped.
Smaller area + Less caves/ruins/etc +Same size game world = a much less cramped, much more proportionately sized, and therefore much bigger feeling game world.
Think of it this way. If you have a jar filled to it's entirety with jelly beans, it would obviously seem very cramped, and the jar would seem small. Now, you have that same jar, and only put in half as many jelly beans. All of a sudden, that jar seems large. Understand?
I'm just curious of people think it would be smaller.
Why do you think/thought it would be smaller?
Seeing with all games series out there, the world size is practically always increasing by every new game.
Again, they thought it would be smaller because Skyrim is smaller than Cyrodill. If the devs would have kept the same proportions that they had for Oblivion, the game world would have been smaller for Skyrim.