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I think it is standard.
It is a bit like a Playstation or other console memory card, except that it is built-in (you cannot swap it with another "memory card"). Or like the SRAM in SNES cartridges, except that you can save from different games.
And yes it seems very small, but at that time such memory reached a high price. They should have planned a larger NVRAM, but I guess the price would have risen quite a bit. Or perhaps they did not think too much was needed (hoping that coders would prefer using level codes).
Back in the days, I never really followed news about the development of the CD32. Some experts might have better details to give and/or articles to point to.
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