It would be fine if you don't want to install loads of games.
My Steam folder is about 36GB, and I have 3 full games installed. Windows 7 + essential stuff uses about 30GB, call it 40GB to be safe. 3 Games + OS = 76GB.
I reckon a 128GB SSD can comfortably hold 5 full game installs. For some people that would be an issue, for others, no problem.
I'd still have a normal HDD for backup purposes anyway.