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Well, I know it exists. At least in Korea.
There is a symbolic example of your “nano-apartment,” called Goshitel. It is the cheapest form of rent, with about the area of 3.3 meter squared. The term “Goshi” is attached because it has been used by people who decided to spend every minute studying for the Goshi exam and become the public governor, the most sustainable job in the country.
Therefore the first reason people need the nano apartment is to have the longest possible time while not working for their reasons: people who refused work. Well, the second reason is to just save some money: people who work. The third reason is that they don’t have money to escape: people who can’t work, like the homeless.
I’ve seen some documentaries about these Goshitels and I think you can easily find one with that term. As Goshitel has a poor image, those are more focused on the difficulties of one and people inside. But as I described, it has a diverse demographic and the documentaries only show portions of it. Things to note is that it has an overall negative image of dirty facilities and depressed people. That can be why nano apartment was not spread outside Korea to America.
Back to your question, I suspect some reasons that nano-apartments does not exist in the US while more frequent in Korea:
One more:
I just sparked some thoughts here and it may be insufficient to bring a complete concept. I realized explaining Korean stuff to America and bringing American stuff to Korea are extra time consuming, as you don’t know “Goshi'' and I don’t know housing in New York. But I enjoyed comparing cultural differences and hope you ask more for confusing parts.