I agree that giving fish room is a good thing.
However, a bought 2 rather small, young tangs (sailfin & scopas) which I put in my 25g frag tank over a year ago. Today they eat well, are quite healthy, and have grown some. I may soon need to move them to my 65g shallow reef. But I've seen no ill effects of having them in even a small 25g tank with no live rock, just a raised egg crate rack (1.5" off the bottom of the tank) and coral frags.
I don't see this as a huge issue.