Small databases aren't popular because Excel spreadsheets already occupy that niche. A small database doesn't have to be normalized. Because it's small, it can be denormalized into a flat table that can be conveniently handled in Excel.
Excel doesn’t cover the publishing and discovery aspect. It is absolutely atrocious from a machine usability and schema perspective, nevermind performance, etc.
Even if you think excel does address those, I think the shortcomings of the format should rule it out. It is better to have a more powerful tool, and fix the usability aspects, rather than trying to proverbially rub glitter on what amounts to a turd of a format.
Excel as a format is an awful abomination of XML, and the program itself is an awful experience that people just stick with due to a mix of Stockholm syndrome and inertia. It’s not exactly something I would ever want to “aim for”.
You and I may think so, but why would it matter for the end user?
"and the program itself is an awful experience that people just stick with due to a mix of Stockholm syndrome and inertia"
Disagree. For the purpose of what Excel was made for, it seems reasonable. Or rather, I've yet to see what benefits alternative experiences produce. For the vast 90% of users, Excel is a 1NF/2NF db, emphasized on visually viewing their data. It's dead simple to enter, dead simple to share, and reasonable easy to add some constraints, some linkage, and show data trends.