And as political background, this is basically the "we'll offer both options" resolution to the R6RS acrimony. R6RS tried to take the language in a more "batteries included" direction, which led to a lot of resistance from some quarters, and was part of why Racket ended up disclaiming itself as being a Scheme and going in its own direction (the Racket team was quite involved in R6RS, and I believe stung by the way it was essentially rejected by a big part of the Scheme community). R7RS-small is sort of a spiritual successor to R5RS, and R7RS-large is trying to carry on what R6RS attempted, but in a way that can be factored out of R7RS-small and used to complement it.
The problem people have been trying to work through is that many people like a small, clean, minimalist core Scheme, but many other people (well, some are the same people, myself included) don't think the current standard is enough to produce useful interoperability. Especially implementors like being able to write small self-hosted experimental or embedded Schemes without a large standard. But many people writing Scheme code are not all that happy about the poor interoperability story that ends up resulting, because there is not quite enough standardized to write libraries that will work on all the major schemes, which is why there's no Scheme equivalent of CL's Quicklisp repository of cross-implementation libraries (the SFRI system is the only real attempt to make this sort-of happen, and is not really good enough).