No need any template changes for smallfont.
In functions_forumlist.php, in the code you added, replace:
PHP Code:
$output .= "<td width=50%>" . construct_subforum_bit($forumid, $cancontainthreads, $subforum, $depthmark . '--', $depth + 1) . "</td>";
with
PHP Code:
$output .= "<td width=50%><span class=smallfont>" . construct_subforum_bit($forumid, $cancontainthreads, $subforum, $depthmark . '--', $depth + 1) . "</span></td>";
You basically put the <span class=smallfont> </span> in the php file rather than the template. Why not? You've put the <td> tags there already. This way, you don't have to modify the template.