Yea thats about right, smaller rooms are bad for reflections that will "colour" what you hear from your speakers, as you'll be hearing some sound directly from the speakers, and some thats bouncing back from the walls/ceiling around you. The main problem is the low end, higher frequencies can be contolled quite easily with acoustic foam etc, but low frequencies need more mass to absorb them, which is the problem when the rooms quite small. Be worth having a look round the sound on sound forums and at some of their articles, you'll get a good idea of the best way to set things out.
As far as monitors go, most nearfield monitors will be designed with smaller rooms in mind so you shouldnt have a problem, its only bigger monitors that cause a lot of trouble.