Britain's House of Commons has 646 members (it was 653 until the 2005 reorganization in Scotland that made Scottish constituencies equal to English ones and will be 654 after the next election), and the House of Lords is even larger. They never have a problem functioning.
Let's be honest. Very few members of the Lords attend. The quorum is 3. The Commons Chamber, IIRC, cannot hold all the members, IIRC.
In principle, I agree with a fixed population representative system. I note however that the PA State House has 203 members, and that has not improved representation.
I'd prefer it to be fixed to an actual number. Perhaps somewhere between 300,000-600,000 people per district. If you attach it to the population of the smallest state there is the chance (albeit slim) that the ideal district size could balloon up over 1 million or shrink down to only 100,000.
Historically the population of the smallest state changes slowly with time. Unless a new small state entered the union, or small states somehow merged, I see little chance of the extremes you note.
