You on about the towering buildings in which everything is done internally?
I think the idea is great, it's all self managing and what not; only problem would be the Vitamin D deficiency rife in an entirely internal society. A small building would be too inefficient to sustain itself, where as a taller building, not everyone would be able to go outside.
It wouldn't be cramped, it would be like those old Gmod 9, tower RP maps, plenty of room, everything is easy to find et cetera; built for optimal efficiency.
Over crowding due to kids? That's what a crèche or schools are made for until they're old enough to leave.
Not much call for adventure and leaving though, as such it would be like living the Truman show, a small area you could never really leave, unless it was able to manage without you.
Building upon the idea of doing it successfully, if it was done, properly then in theory we could do so on another planet; the only real drawback is the hauling of supplies to begin with i.e. Maintenance would be a bitch on Mars, especially with the supply haul.