Don’t quote me on this, but I believe gnomes were enlarged about 10% before Vanilla was released, which had the side effect of scaling up their mounts (which is why they have the largest mounts in the game). Blizzard later realised and chose to keep it that way.
Yes there was, Blizzard made us drink the Ent-draughts to entice new players to pick Gnome. A disgraceful change that didn’t attract new gnomes and left the rest of us slightly larger
Smaller Gnomes just makes it easier to dropkick them across the battlefield. A lighter weight Gnome would have less surface drag and a lower weight coefficient, this would yeild a greater gain in distance traveled.
Actually not sure when they nerfed it. There were other effects back then which got nerfed as well. Enlarge effects as well, like the troll witch-doctor who could enlarge you as one of the effects used to stack with enlarge effects for example.