I just made a hat start-to-finish on a 24" circular needle. As I finished each round, I'd pull the right needle until the stitches went onto the left needle, making a large loop*. Once I got to the decreases, I split the stitches in half and switched to Magic Loop.
Small diameter knitting can be accomplished in many ways, and it's up to you to decide which method fits your knitting style (and budget!) best.
[size=2]*There is a member here who uses this technique that gave me the idea, but I can't remember her user name right now.[/size]