I own a Miniature Australian Shepherd - actually, we have three. My boy, Morrie, actually is slightly "above" the standard height limit for Mini Aussies at about 19". He has his puppy championship in conformation with NAMASCUSA (
http://www.namascusa.com/ ), acquired in Denver, CO from his breeder before he came to us. NAMASCUSA supports the outcrossing of miniature aussies to standards to "define" the conformation, etc.
I have seen my share of BAD mini aussies and my share of REALLY GOOD ones. The bad ones generally are bred for size, but I think the permission to outcross to standard aussies to improve conformation really sets them apart from other "mini" breeds. They are not a fad breed, they've been around for ages. The toys are really the ones to watch out for, they often get crossed with poms and are just rotten looking - an ideal mini aussie should be an exact replica, except smaller.
I don't know the reasons behind it, but I do know that, as with every breed, you get the good and the bad. Generally watch out if, when looking for this breed, you come across a site selling them with pics of them as young puppies, when you can see absolutely nothing about conformation and only color - THOSE are the ones I worry about. We have had experiences with both ends of things - our two girls came from what appeared to be a reputable kennel, but the experience there turned out to be horrific - dogs arrived with kennel cough, tape worm, were eating their own feces, had no discretion about where they expelled waste... and then when we got Morrie, it was a completely different experience. We're glad to be a part of the breed.
I don't know about the different size for different animals to herd, but I know our guys can do a number on goats, sheep, etc - they try with the horses, lol, but just a teeny bit too small! They're also fantastic agility dogs - Zoey will be wonderful as she'll be in the 12" - 16" height class but Morrie will be a bit more difficult in the more competitive 22" category.