A more apt metaphor would be separating a book into many small paragraphs that each serves a single purpose makes the book easier to understand. Regardless, the book metaphor misses a lot of the nuance.
Of course taking the approach to an extreme would be detrimental. However, a vast majority of these small modules that are actually widely used consist of functions that may seem trivial at first sight, but actually contain a lot of corner cases and special considerations that a naive inline implementation could miss.
Sure, there are also plenty of trivial one-line modules on npm that don't fit into a such a description, but those are simply side effects of the unprecedented popularity of the platform and its completely open nature, and shouldn't be used to infer any kind of general trend towards "hypermodularisation" because very few reasonable developers would ever import them into their projects.