In my own private rebalance of units, I found that although having lowered cav attack values but increased mount mass as well as increasing projectile accuracy (the composite and bodkin ones for archers and the steel crossbow for xbows), cavalry are very vulnerable to missiles, so their normal units size would still allow them to deal a good deal of damage.
Decreasing the cav unit size may make them move more easily on larger unit sizes, but on small and medium, they will be cut down by any army that has several decent missile troops.

I would imagine that a unit of longbows having a high range and hiding behind an infantry (not necessarily spear) formation will stop the cavalry charge before they could deal any large amount of damage while having to ride around the flanks or rear. Archers may be weaker in melee, but that doesn't help the cavalry.

Also, the other trouble with weaking cavalry stats, although making their charges slightly more powerful, is that they will be very weak in melee (along with their now smaller unit size), meaning all they are good for is charging and chasing routers. Considering that with each charge the unit they are charging can just ignore their current opponent and turn towards the cavalry (double click run disengage quick turn+attack) to cut them down (again, smaller unit size so faster to kill).

On a side note, have cav charges against cav been fixed in Kingdoms? In M2TW it is quite dishearting to see cav charge each other with damage only being done with the swords. Same if cavalry charge another cavalry that is static but in formation.