Hi Bullwinkle,
it is perfectly possible to use such a small installation. I use a 170 MB Vectorlinux-Installation on my laptop. (I wrecked my SuSE-Installation one day and was to lazy rebuilding ist).
BUT: If you are a newby, missing packages which you possibly need for compiling or installing some programs can drive you mad. When you are a experienced Linux user you just install the missing packages. As a beginner you possibly despair.
It is easier to learn with a full blown installation, but hey, just give it a try.
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