Fly fishing small streams is a beautiful thing, and a two weight fly rod would seem to be a practical and logical choice. After all, most of the time, we are casting a very short line. One could easily overline or underline the rod to meet a variety of circumstances. Furthermore, a light weight rod is simply fun to fish, particularly, when catching native trout, which are often colorful and tough, but smaller fish. When considering line control, however, a fly rod under 7', really begins to become a specialized rod of limited and practical value to the fly fisherman. Nevertheless, if I were to fish streams of heavy canopy and limited space for casting, I certainly would consider a 6' rod. That being said, I have never found a stream that was so heavily canopied and worth fishing that I could not get by with a 7' rod.
My personal preference, when fishing small streams, would be a fiberglass fly rod, 3 or 4 weight, 7 or 7.5'. Fiberglass fly rods and small streams are a match made in heaven. They load quickly under short lengths of line, are very pleasurable to cast and just plain fun to fish. What is more, they are less expensive than comparable graphite rods. It was my good fortune to learn to fish on fiberglass rods. For what it is worth, I highly recommend giving it consideration.