The scaling rules in the GD3e rule book can be interpreted in many ways, so here is a short clarification derived from what worked out well during game sessions.

Combat usually occurs between the player characters and creatures. Unfortunately the rules for scaling tend to leave larger creatures not hitting their targets, as the penalty for smaller enemies easily negate their Attribute and Pursuit values.

To fix this issue, here are some quick steps:

•	the damage scaling rules should always be applied. This will make larger creatures tougher and stronger, while they still have a chance to hit human sized characters

•	Over-/Undersized Gimmicks should only be used when attacker and defender are sharing the same environment, e.g. humans, animals or monsters; cars, planes, motorcycles; starships, space fighters, planets

•	if different environments are involved in a combat, the size scaling table should be used and Over-/Undersized Gimmick should be ignored as the modifier already include these factors

Alternative Explanation
The scaling is for things of different scales meant for different environments. Meaning a starship vs a person or tank vs a person. So the scaling is included for creatures to illustrate the massive differences in scale for different environments. You don’t need to apply them for a dungeon crawl, for example.
If you want to run a traditional dungeon crawl, do not use damage scaling– use the value as they are.