How to place a big lot on a smaller lot?

Yes, I've done this often. The only thing I would add is that while you don't have to delete the landscaping/other items that will be cut off before placing it on the smaller lot, I still like to clean up the lot first sometimes. Particularly if you are downloading a house from the gallery, if there's a lot of landscaping, then there's often a lot of extraneous terrain manipulation that goes with it, and plonking that straight down onto a smaller lot can make weird things happen around the edges that are hard to fix.

So if I'm downloading, I will typically move it onto a larger lot and smooth out some of the terrain, at least around where I expect the edges of the smaller property to be, and also look out for anything else that might be funky (like ending up with half a swimming pool), before saving it and then placing it on the smaller lot.