To me, your content area is just way too big. Though, it seems to be a common habit of Windows users to maximise everything, for some reason. I fit my Dock (left), browser, Twitter client and terminal on the same size screen as that, very happily!
If you bring up a window, and it's too small, you could either: A. Drag it to where you want it, and then fiddle around resizing it so that it's big enough and doesn't overlap anything else important, or B. Maximize it in one click, do what you need, minimize it again.
Additionally, Windows windows have lots of chrome when unmaximized, and this tends to discourage heaps-of-small-windows layouts.
Try out Winsplit Revolution. The help page gives a nice overview of the functionality: http://www.winsplit-revolution.com/help
It's free and works great for positioning windows. You can position windows using hotkeys and create custom positions/window sizes. WIN+ALT+Numpad 7 will place and resize a window in the top left of the screen, WIN+ALT+Numpad 6 will place a window on the right side of the screen and take exactly half the width, etc. It's become second nature to me and I rarely have to worry about manually placing a window.
How on earth you work with Twitter always visible onscreen I don't know. Do you get anything done!?