They suck and also the higher capacity batteries take up too much space now.

We can, there's just less demand for them. Sony was among the last holdouts for small phones with their compact series, but they stopped because they were their worst selling models.

Even Apple stopped selling their small SE model (that was basically iPhone 5 sized) despite it being the cheapest iPhone to get your hands on, because it sold terribly.

Small phones is something the tech community says it cares about, but the market has proven that the average person doesn't care. Same as the headphone jack and microSD slot.

I don't like it either, but phone companies aren't deliberately leaving money on the table. If they thought small phones would sell gangbusters, they'd bring them back.

One thing that annoys me with the market at the moment is that the majority of folding phones available are like small crappy tablets that fold into a large, impractical to carry phones, and not large, very usable phones that fold into something much more compact that is easier to carry..

You can. Even if life can get complicated is entirely doable. Unless you live in like China with mandatory apps.