I am currently working out a Pixie PC character with one of my players, but we've run into a problem. Pixies being tiny creatures can't carry much of anything (especially with 2(-4) Strength). This makes the use of almost any items near impossible, they couldn't drink a health potion or even lift it at all.
The player suggested that the character gains a natural ability as part of being a pixie that everything they touch shrinks down to an appropriate size at will.
Would this be fair? Is this over or under compensating? If it is, can anyone thing of an alternative solution to the "everything is giant and I cant use it" problem?
The PC has the exact same stats as a regular pixie such as ability scores and AC, as well as their magic resistance, superior invisibility and innate spellcasting.
Best Answer
The pixie should be able to use most items without issue already, but your solution should help
Pixies can lift items up to 30 lbs
A pixie's carrying capacity should be 15 lbs (2 (STR) * 15 / 2 (Tiny)) and they can lift/push/drag 30 lbs. This means the pixie should be able to at least lift potions and other items without issue as long as they weighed less than 30 lbs. So, as far as lifting goes, you may not have as much of an issue as you think you do.
As far as using the items after lifting, nothing in the rules prevents it. Pixies stand "barely a foot tall" so the pixie may be trying to drink from something which could be 1/4 to 3/4 of their body length depending on the size of your potion bottles. This is probably going to look humorous but there is nothing wrong with it really.
Pixie-sized loot is still potentially a large issue though
Even though pixies can lift and use a bit heavier of items than you seem to think in your question, there is still the issue that pixies are going to have a hard time finding any kind of weapons or items that are sized for their use. This is going to put them at a disadvantage versus the rest of the party potentially unless the DM specifically provides solutions for it. For example. providing the correct loot could involve granting magic items which could resize to the pixie, making the pixie buy custom-made weapons/items/armor at towns, or giving the party lots of tiny monsters wielding tiny weapons and armor for them to loot. If this is something you don't want to deal with, I think your proposed solution is probably going to be a good way to go.
Adding a shrinking ability
There doesn't seem to be anything inherently overpowered by giving the pixie this ability. One guideline you may want to look at is treating any items as if they had been reduced using the reduce spell including a 1d4 reduction in weapon damage, and a 7/8 reduction in weight.
If you are set on making this homebrew work smoothly and are trying to avoid the above situation then it should be a good solution. Make sure the player knows that you are trying to accommodate their character choice as best you can and that it may involve some tweaking down the line. Tell them that if the ability is discovered to be a major issue sometime down the line, that you reserve the right to tweak and change it to preserve fun at the table.
The toothpick assassin and related issues
For example, there is one case that comes to mind (via @doppelgreener) that highlights an instance where the power might be abused and that the DM should be aware of going into this: the toothpick assassin. The idea behind this strategy is the pixie grabs a spear, flies into the mouth of an opposing creature and down their throat, then lets go of the spear. Upon letting go, the spear grows back to normal size and potentially strikes a hearty blow against the enemy (probably instakilling it though this would be outside of the rules).
As a DM you might consider deciding how you feel about this kind of strategy and discussing with your players ahead of time to head off any issues. It is not clear even how the rules would handle such an attempt at attacking so, if allowed, it will probably result in a lot of DM rulings on how to resolve things. You can let the players decide what kind of power level they want to deal with. However, remind them that, if this strategy is allowed, enemies and NPCs will also be free to use it against the PCs. Coming to an agreement or making a ruling before this becomes an issue might be the best way to handle this.
A related issue that the DM will have to decide will be how thrown weapons would work. Technically, any weapon thrown by the pixie would grow back to normal size as soon as it left the pixie's grasp (and thus do normal damage assuming you are using the reduced damage as mentioned above). As DM you can simply rule that projectiles simply stay the same size or allow it to increase in size if you don't think it matters.