Your "other" makes no sense. It doesn't matter if you make a few big or a lot smaller, in space you will still need the same space for the same amount of megawatt. Or did you miss the scale of parent's post ? Because in that dream scenario of "let's ignore all the issues except that" and "the earth and the sun don't have any impact", it's still 3 THOUSANDS square meters for a MW of 8 racks.

You want to go smaller and go one rack only sure, it's still hundreds of square meters. Check the size of current orbital structure for a point of reference, you can't dwarf those and call it a "dataswarm of tiny datacenters flooding the sky".