Yes, I would happily use the smaller end of the allowed range if it gives the players a better game.
The pitch is there to serve the players, not the other way round. If a group is spending long periods disconnected from the ball on the biggest 5v5 pitch, reducing the space can increase involvement and create more repeated actions.
The trade-off is exactly what you mention: go too small and the game can become constant collisions, rebounds and rushed touches. So I would not assume smaller automatically means easier.
Start with the group you have. If they need more involvement, reduce the pitch slightly and watch what changes. Are more players receiving? Are there more 1v1s? Is there still enough space to carry the ball and look up?
Current England Football guidance allows a 5v5 pitch from 27x18m up to 37x27m. I’d use that flexibility deliberately rather than treating 37x27 as compulsory.
