I didnt download it yet...
try it first. maybe you don't like plop linux
I do not know that Gnome need like you say 2.2gb 
gnome is a desktop environment that provides a lot of libraries, a lot of functions and many other stuff
What is squash is this something like Slax use.
sqfs is a compressed read only file system. it can be used for many things. many distros use it for live cd's.
And what kind of Window manager i will have after i use sqfs?
you will have the same system like on the cd. the big purpose of sqfs is that its a file system that is compressed. you can access the files in the same way like on a ext3 file system. but its read only. but that doesn't matter. you can write data to the hard disk even if you use the sqfs version of plop linux.
I'm not used very well with consoles.
hmmm
Is there any other window menager for future releases
- i mean something smaller?
gnome is not a window manager. there is a big difference between a desktop environment and a window manager. a window manager is a program that runs in a desktop environment and handles the windows layout, windows borders and all that suff. but a window manager does not need a desktop environment. the window manager of gnome is metacity. plop linux has also the light weight window manager fluxbox included. fluxbox does not need a desktop environment. but if you want to use programs from gnome, then you still need the gnome libraries.
i don't know what you want to do with your machine and what programs you want to use.
regards
elmar