Why are childrens' tombstones smaller than those of adults?
I was always under the impression that it was because the tombstones were placed primarily in order to warn Kohanim of where the graves were, and thus they were laid flat over the grave to cover it(see Mishnah Oholot 15:8 and 15:9 with surrounding commentaries). Since children's graves are by nature smaller, the stones laid upon them to cover them would by nature be smaller as well, especially as the above mishnah states the Ziyyun did convey tumah, so it would stand to reason that one would not want it to be any larger than necessary. The Jewish Encyclopedia also has a fair decent article on the development of graves through history.
Maybe to intensify the grief ("agmas nefesh" - see Berachos 5b with Rashi ד"ה ביר regarding R' Yochanan's practice to carry with him a bone of the tenth son he buried).