Consider the BK Princess with a 2.8 cu ft firebox. That's four times larger than a Squirrel firebox, and yet it uses the same size 6 inch flue. The Squirrel comes from the factory with a 6 inch collar, but from operating it I believe it would work just fine with a reducer, a 4 inch flue, and with the internal restrictor removed.
I'd email Morso and ask them. They'll know for sure.
Greg
I think the manual is pretty specific about the 6"
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