Smaller people usually have a smaller power output. The important thing is that you have more watts per kilogram. That is traditionally calculated by just the rider's weight, but for your purposes, it would in fact be more accurate to calculate it with the bike, rider, and any gear s/he will be carrying.

Since I could stand to lose 20 or 30 lb and still have a low power output, I guess it really isn't that important to me.


I suppose, but then the second to last upgrade would be pointless, then the third, then fourth, etc. So in that light, my only answer to that would be never do anything half-ass.