I think that is a very helpful insight. And I think there is actually plenty of social science research supporting the thesis that a well-selected smaller college–meaning one with at least a decent percentage of kids who are the sorts of kids who are potential friends for your kid–is going to have plenty of students to “fill up” the more intimate social circles (which typically range in size from around 5 to around 50 depending on the level of intimacy involved).
Like here is one such visualization:
I note if you look at the broader social circles, what this implies is at a smaller college, most or all of the people in your class year could end up acquaintances, and you could at least recognize most of the people in your entire college (understanding this will churn each year). And some people may find that too limiting, in fact, say the sorts of people who are excited about meeting lots of truly new people on a regular basis.
But it sounds like your kid is not one of those people, and instead is the sort who is really going to be focused on the quality of the relationships within the smaller circles. And again, those numbers are such that a small college really isn’t likely to be very limiting, unless perhaps it is just broadly inappropriate for the kid in question in terms of student culture and the other kids who select that college.