I agree that a one level is probably going to work best for him. Walmart has some carpet that is about 5 x 8 feet that is around $20 that is a good deal. It is larger than a 4 x 4 puppy pen but larger is better than smaller and because it’s inexpensive I don’t feel too bad about throwing it away and replacing it regularly as needed. They also have some smaller bath mat type carpets with plastic on one side that I have used as a second layer that can be thrown in the washer but not dryer – just air dry them.
Litter box training may be a challenge too but cutting down one side as you are doing sounds like a good idea.
You may also want to put down some carpet protectors under the carpet to protect either your carpet or hardwood floors – they are plastic and can be found at Home Depot and are cut to size – they are only 2 feet wide so you will have to use 2 side by side to get the right size.