I'm not sure why Junyang chose to make it so small (other than the obvious fact that smaller things are cute), but it's pretty impressive that he got a papercraft item that size to look so much like an iPhone. He even made a scale charger and cradle for it, and the box it came in. He even replicated the instruction manual for it! He's a madman!
But it does look cool. If a more to-size iPhone is your pleasure, there are a few different print-and-cut models floating around. And I'm pretty sure you're just one Photoshop scale away from shrinking it down to a size like this. Of course, in just a few years, they'll be this size anyway ("the iPhone Pico"), but until then we've got papercrafters to show us the cuteness.