I understand, but also remember that the fact that they're on small lots also decreases the amount of open area NOT lost to an equivalent # of housing units built on larger lots.

We happen to live in a neighborhood like you described (although our lots are about 1 acre), but there were no trees until the houses were built 15 years ago...and now there are trees everywhere.

Established neighborhoods with big shady trees have to start somewhere...

There are many models of controlled balanced development - I am a big fan of the Sycamore Land Trust in Bloomington Indiana. Portions of new developments are placed into the trust and provide for SUBSTANTIAL green space preservation and provide for substantial shelter and privacy in even the most densely populated areas of town...but it's easier to do this in University and Hi-Tech communities...