The small MiKTeX is already small, but I think we also should distrubute a minimal MiKTeX including just base LaTeX and standard packages. Then the auto-installer should install everything else. Excluding source files as well of course. Maybe 5MB is reachable? This would a great improvement for modem users.
PS! (How minimal we can discuss.) Let me know if you want me to test how minimal we can make it, but please inform me which cab-files are absolutely needed to make MiKTeX itself run.