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Copying and pasting a feature class or a feature dataset fail with this error:
Gridsize too small
When copying geodatabase data, incorrect grid size in source feature class results in complete roll back of the Paste. This can only happen when data is copied from a personal geodatabase to an ArcSDE geodatabase.
Personal geodatabases are not as strict as ArcSDE geodatabases when accepting grid sizes for feature classes. When copying and pasting from the personal geodatabase to an ArcSDE geodatabase, the grid size from the personal geodatabase is used. If this grid size is not appropriate for the offset and scale of the target feature class, the error "Gridsize too small" will occur and all the data loaded as part of the Copy/Paste operation will be rolled back. The grid size cannot be modified in a personal geodatabase.
You must load the data with correct grid sizes.
The GetFCGridSize sample in the ArcObjects Help provides a tool that will calculate the grid size of a shapefile or coverage.