I have a bike with 451 mm wheels that I ride 98 percent of the time! I don't give up riding quality, speed, performance, or comfort. A bike's design - primarily frame geometry - has more bearing on those qualities than wheel size. Not that wheel size doesn't matter - of course it does - and not that big-wheeled bikes don't roll more smoothly, they do. But you can still have a fine-riding small-wheeled bike. I think the performance of the mass-market folding bikes is probably quite different from that of a high-performance machine with small wheels.

Note that the frame of the "mini racer" is actually quite small. These bikes don't have to fold to be transportable. If you take off the wheels and remove the seat and pedals, a bike like this could fit in a case used to carry electronic keyboards. You need folding for commuting, or stuffing into a "regular" suitcase, but there are other possibilities!