@Arella Mae,
Artificial selection was the means Ive always been told. Selective cross breeding with small types and keep breeding them. Sorta like how they do it for dog breeds.
What are dwarf horses good for besides some weird fascination with these kinda creepy animals.
At least mules are a useful being. Ive known the miniature horses that these local people breed for petting zoos. They often get some of the horses that are exceptionally "nippy" and they have the horses euthenized. Id rather not even start with the breeding cause I hate euthenizing animals just for some vanity .