I'm not an alt expert. But I work in a manufacturing environment and I think the answer is simple.
Its all about cost/profits. Large 'stock' alts are designed to be easier/cheaper to build and are mass produced. Small HO alts, probably take much longer to build, probably are not built on an assembly line, and likely to use higher quality equipment/materials. That they can make more power in a smaller space does not surprise me.
Anything that is mass produced is driven by reducing costs for the manufacturer. Its the same reason that batteries that come in new cars have a lower plate count than the aftermarket ones that replace it.
Another example would be the Alpine PDX amps. They are practically half the size of some amps but can often put out more power.