i guess if i had 10 mp4 players it would be the same, just more expensive, right?
Correct - but smaller and easier to deal with / most likely will allow for looping videos better, etc.
do these things use different country formats?
Not that I know of, but I can't say for sure. If someone knows, please chime in.
Sounds like you are on the right track. You may have to use small speakers to go with your 2 and 3 inch screens as most of those will not have built in speakers. Many of the 7" ones do. Consider that when looking at overall cost and effect.
Have fun 