A Pirelli tire engineer explained it very well better than I could. Hopefully he can help you understand it.
I don't think that explained it very well. It's talking about overall wheel size, diameter of the rubber.
Sometimes wheel is used interchangeably with rim, sometimes it means rim+tire.
Most folks are not changing the overall diameter very much, smaller rim means larger sidewall, but the aerodynamics of the whole wheel (rim+tire) are worse with a large rim. Tire sidewall is aerodynamically cleaner than the rim.
This you tube
Why Big Wheels Are A Bad Idea On Electric Cars almost gets there, but it comes out in his comment
CLARIFICATION! Why do bigger wheels mean worse efficiency, when the overall tire diameter remains the same? This comes down to aerodynamics. A 20" wheel will cause more of a disruption in airflow than an 18" wheel. That's why Tesla (and others) uses aero covers on their wheels (Car & Driver testing showed it gives about a 3% efficiency bonus at speed). The smaller the wheel, the more of the side profile of the wheel & tire is perfectly flat (the tire is flat, the wheel is open: more tire = more flat area, less open area).
