it's never intended for small purchases.

Satoshi described how zero conf will work for vending machines, and the white paper says "small casual transactions".

Satoshi didn't even want the 1mb block limit, it was Hal Finney's idea, and Satoshi only agreed because it was a good temporary measure to prevent a spam attack while Bitcoin was vulnerable in it's infancy. Satoshi also wrote how the block size should be increased with advances in hardware.

It can be phased in, like: if (blocknumber > 115000) maxblocksize = largerlimit