Is the phrase "smaller than average" used as an adjective here? also, is it okay to say "might provide dinner plates which are smaller than average"?

Rebecca

Yes, "smaller than average" here is used as an adjective. The rule is generally to hyphenate words which are put together to create an adjective which describe a noun that comes directly after the adjective. So it is actually more correct to use "smaller-than-average" here with hyphenation. It is also correct to say "might provide dinner plates which are smaller than average", and in this case, you do not need to hyphenate "smaller than average" since it comes after the noun in the sentence.