Yes, launching small sensors inside fluids is a good idea. The only issue would be if they were to become lodged somewhere. But, if they are cheap enough, deploying many would solve that issue based on the odds.
I believe that this 1" square satellite could be much smaller. Take a look at the worlds smallest complete computer system.
Very interesting, they need to do something like this for collecting information inside of thunder storms and tornadoes. They would be easy to launch up into the wind, each could collect and transmit information and with the right software, they could also become repeater stations for units too far from the main recieving stations.
I look forward to seeing some results from this experiment. You could also use this approach for water flows, salinity measurements, etc. I can see many possible applications for this type of satellite sensors.
Very interesting indeed.