Contractor is convinced 1-ton HVAC is too much for a 504 sq. Ft house.

This dude has very quality reviews on his site yet he refuses to build my house unless I pay to have the crawl space encapsulated and divert the "extra air" down there. This guy us scamming me or extorting money out of me right?

Every article I've read said one ton is exactly designed for 500-ish sq. And that 1.5 ton is for over 700 sq.