This seems like a simple and easily workable solution to something that might be a little vague to a lot of players. Since we don't have an upper limit (and I've had this whilst working on builds with people), it's a little hard to judge the exact size a region can be without being a problem for others. Having an upper limit for initial claims would solve the problem of massive claims, and would also probably make the quality of a lot of builds better- if you're constricted to a 300x300 initial plot for building a city, for instance, you'll probably focus your efforts on making a handful of buildings look nice, rather than just building more and more average builds in a massive region.