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Those are great points, as to how the undersized LB strategy works. I'll throw in a couple other ideas:
1. having a bunch of fast guys can mitigate the size issue, because it means you have 2-3 guys to the ball almost immediately. i.e. it's rarely one on one
2. the hawk tackle. the seahawks spend so much time practicing how to tackle. they don't rely on size advantage alone to bring a runner to the ground. they use physics and technique.