the size of the Linux kernel really depends on the feature set you require.A standard kernel tens to be close to 1Gb, but below 100Mb are not unheard of. If you remove unwanted services and everything you don't need what you have in mindshould be doable.
There is a project called Yocto. I would like to recommend to go to yoctoproject.org and submit your question about what are the most effective size reduction approaches if you still need a GUI and web interface, but not much elseto their mailing list. Yocto Project is an embedded Linux* framework focused on enabling customizing Linux to embedded needs. They may be able to provide some good tips and tricks. It is not MeeGo*, but it is more flexible than MeeGo for what you have in mind. A lot of the feedback from them should be also applicable to be valid for MeeGo should you decide to stay with it.