Society Finches, Nest too Small?

Question
My two Society Finches had six babies about a week and a half ago. All was well until today, when we discovered a baby on the floor of the cage that wasn't alive. He seemed perfectly healthy. I've cared for adult finches in the past, I'm no expert by any means, but I've never had a pair have babies. I think the problem is the nest is too small. When my husband and I purchased our birds, we had no idea nor intentions for them to mate and got them a standard sized, smaller nest. We thought they were both males, Prometheus and Apollo (who turned out to be Apolliana). We're afraid the nest is too small and that's why the bird was pushed out. Upon looking in there, they are awfully squeezed together. I placed a bowl with their nesting hay in underneath it in hopes that if another fell out we could at least try to handfeed it. The cage is a perfect size for two and not very large, so the bowl is only 10 inches or so from the nest. We also, as soon as the babies can move, are going to move the family to a considerably bigger cage as we want to keep all the babies. I want to at least move them to a bigger nest for now, but I don't think you're supposed to touch babies. I think they're in the fledgling stage, some fuzz and quills(?) on their wings growing in. They're about half the size of their parents. They're growing fast and with research we've given the parents a proper diet, which is why I was so surprised. We don't want to move them and risk the parents abandoning them, but we really don't want anymore getting pushed out for room, if that is the cause. I think I've included all of the details and would be happy to answer any questions. I just really don't know what to do.

Answer
I'm not entirely sure what the question is but it sounds like you want to know why the babies are on the floor and if it's alright to put them back into the nest. It sounds like the parents are just kicking them out of the nest. Are they still feeding the babies? What kind of nest you have? I highly doubt that it's because the nest is too small. I have had societies in the past and all eight of them would try and cram themselves into one wicker nest (and succeed).
It should be fine to put them back into the nest, just keep an eye on them for a couple days after you do. Some parents do kill their young but I've only ever come across one society that did that. You may need to hand feed the babies but societies are usually good about that.