I could tolerate the occasional short as long as it does not destroy anything. Would I be right in expecting the over current protection to kick in quickly enough on such a small layout?
Size of the layout is not the determining factor. Total resistance is.
Shorts always do damage. The question is how much. At the very least, micro pitting of wheels and track will occur. Enough pitting at the same spot over time will be a problem especially on thin metal such as point rail taper. At the very worst, a wheel set becomes a toaster and melts truck frames and ties. On a positive note, unlike DCC, RP modules seem unaffected by shorts on the rails so module damage is unlikely.
As you know the trick is getting the breaker to sense and act fast. This requires an extremely low resistance electrical path between PWR and loco. Here is the issue... train equipment caused shorts are not zero resistance. In fact, they may not be anywhere close to zero resistance. Bus wiring is not zero resistance either. Total current flow will be determined by the sum of the two resistances. As resistance goes up current goes down. It is quite possible for the equipment short resistance and bus wiring resistance to add up to a value that causes total amperage to be less than the circuit breaker trip point. For example: RP PWR is 14.8v and trips at 4 amps. This translates to a resistance of 3.7 ohms. A 4 ohm short circuit will not trip the breaker. Instead, 55 watts of power will flow continuously. Hold a 50 watt light bulb against a plastic truck frame to see what will happen. Not good. Now imagine this situation with a poorly wired layout. Let's say small gauge wire and poor connections add 2 ohms resistance. A short circuit now has to be less than 1.7 ohms resistance to trip the breaker. It is very likely you will have shorts from time to time that have more resistance than 1.7 ohms.
That is a long winded way to answer your question with a solid maybe.
You can increase the odds the breaker will protect you by using healthy size buss wire and sufficient number of track feeders i.e. make the bus resistance as close to zero as possible. There is much bantering about regarding wire gauge and number of feeders. Personally, I think it is an argument not worth having. Use 12 gauge buss wire period. Use 20-24AWG feeders 12" or less in length spaced no further than 3' apart on the track. Make sound electrical connections (solder). With this arrangement, regardless of layout size, you are guaranteed a near zero resistance path and thus the highest probability the breaker will protect your equipment.