The small edges problem is more fundamental and does not result from the choice of internal units.
Every computer application needs to make a decision about how to handle the fact that computer arithmetic is not exact. For example, if the theoretically same point is calculated from the formula for a circle and again from the formula for a line, the two results are very likely to differ by a small amount. The app must decide whether those two points were meant to be the same (i.e. there is an intersection) or were meant to be different. SketchUp applies a distance test and if the two locations are within that distance threshold decides the points were the same and should be merged into one so that a shared vertex (intersection) occurs. When the two points actually should have defined an edge of a small face, the face is lost.
The alternative, to ignore the issue and just take points as calculated, would be far worse. Vertices would not be recognized as being the same, and as a result even large faces would often fail to form!
This handling is necessary whether the internal units are inches, meters, furlongs, or abstract. All that would change is the specific value chosen for the threshold.