Three minor issues, three possible fixes. Would they work?

While minituarization has indeed become more powerful, the bigger is better rule still applies. You are comparing two different systems where that is concerned. That very old computer made in the 40's(?) versus your cellphone(or whatever) made in 2007. Of course the one made in the 40's is worse. They didn't have the technology that we have now. I think when we talk about bigger is better, we mean a comparison of two modern systems. Your cellphone won't stand a chance verse a computer built yesterday, heck even a two year old computer would easily out do a cellphone. I believe that bigger computer systems in SA will perform better than smaller ones, it makes sense. Smaller one can't hold as many component's as bigger ones. Bigger ones are easier to upgrade. You get where I am going.

They already are that way. Take AIES and PANTHEON. One of these is far, far more powerful than the other, and it isn't your Mindy's computer. Still, miniturized components thousands of years in the future should be quite good. The example with the cellphone and the old computers is relating to the kind of a jump in technological capability one could manage in just a small time compared to the difference between our tech and that of the setting, not to smaller being more powerful than larger.