Nightowl1, I have thought, long and hard, about the same thing. Coming back from a stupid, non-archery related, shoulder injury, I had to drop all the way down to 28#, at my draw length, and start over.
Once I worked back up into the mid-thirties, I figured, "Well, I can live with this, if I have to. I'll just seriously focus on small game, exclusively." (Up to and including coyotes, but with a primary focus on rabbits.)
The good news is that I am now shooting 45#, pretty well, and have put deer back on the menu, but I still intend to do more small game hunting than anything else.
With the exception of killing feral pigeons in my barn, back in the day, (think: arrows in the ceiling), I haven't used blunts in a long time. I just haven't found them to be reliable, "one shot fight stoppers" on anything--particularly at the lighter draw weights. (You have already "broken the code", on squirrels!) I know other guys have had much better luck with them, but I've gone to broadheads, period, for small game.
A 30-35# bow, set up for small game, sounds very feasible, to me. If you have an old "stash" of bodkins, razorheads, or MA-3's laying around, all the better! Sharpen 'em up and bring home the groceries! Good luck!