I recommended the Xperia Compact line to a coworker, and she says it's still too big. She wants it to fit comfortably on a woman's pocket. Something Motorola Razr-sized (about 20% smaller than the Xperia compact).
I can see that being a problem. Anyone that has tiny pockets and doesn't want to carry around a separate bag is mostly up a creek these days, even with phones that the market considers tiny.