"What's limiting us from making 0.0001 x 0.0001 sprites and zooming in by adjusting the layer scale to see those sprites?"
Basically: the actual on screen rendering size and texture size will be the limit.
A texture cannot be smaller than 1x1 pixel (as... it is the minimum quantity of information you can have for an image., less than that would just be non-sense as the number of pixels a texture has is an integer), also, by having a 0.0001x0.0001 sprite object (not the actual texture) zoomed in 100 000 times or 0.1x0.1 zoomed in 100 times will give the same result as the rendered area will be the same and the texture size will also be the same in both case.
If you wanted however to say reducing the texture size, well, it can be worth it in many cases, but be sure that it still looks good, as a 1x1 texture zoomed in will look blurry or pixelated (depending on the sampling), a gradient texture can be scaled down with the linear sampling yet still looking good for exemple, as the blur won't damage it much.