Good naming helps. If you strive to make it obvious what each subroutine does, you can treat them as small black boxes (until you need to look into a specific function). Obviously, there needs to be some balance and not go crazy in either direction.
For some cases that results in more confusing code.
Still, I think the GP has a point - clear naming is very important, regardless of one's attitude towards function size. ;-)
Usually I try to weight the overhead of having more function prototypes to track, indirections in the main function and whatnot versus the overhead of having it all inlined.
A lot of things become more evident as you inline one-use functions, because the whole context is now local.
Interesting, your comment reminded me of inline functions in C++ and C99; not the same thing (or at least goal) as what we were discussing, but closely related: