Actually, there's no "grinding" to be done, they've pretty much gotten rid of a need for that with the riddance of EXP. Also, the quest items...there are 5 slots (probably more later on). If you really can't leave room for what will most likely be 5 quests worth of objects, plus the sticker space (where the quest items can be used in battle and in the OW), well...I don't think that'll be a problem very often. Besides, from looking at the fan, the quest items are pretty darn useful in battle and outside of it.
The "quest items" are one use. You can either use it to solve the puzzle at the windmill OR in battle. If you use it in battle it'll own your opponent but it's gone forever, so now you can never solve that puzzle and never get its reward.
When I said "a game that adds 100 hours by making me go back and forth or grind", note the "or". I don't mean that this game makes you grind, I mean that grinding is a poor mechanic, like backtracking in this game. In the other Paper Marios you never had to grind though. I beat PM2 in half the reported game time so I should've been significantly lower level than I was meant to be at that point (I like to avoid enemies where possible), and the last boss was difficult, but possible. No grinding was necessary.
But they have stats that you increase for doing favours for people. So essentially you're forced to grind out doing favours like putting plants in the ground for a toad where the animation time takes ages as Mario dangles from a crane and slides down to plant them slowly or you'll be too weak in battle. But ironically there's no point in battling at all (use stickers to get stickers), so you may as well avoid enemies like the plague so you don't have to waste stickers (and time).
And my problem with quest items is not how many you can store in your "stuff" compartment but how many you can store as STICKERS in your sticker compartment. If you convert the wrong quest item to a sticker, you're lumbered with it for however long it takes till you find the solution it's used for. You can't just convert all your quest items into stickers, because you don't have the room, and you don't know when you'll get to use them, so your best option is to find the place where you might need a fan, for instance, backtrack all the way back, convert your fan into a sticker and then go all the way back.
That is fake gameplay. It's the difference between:
Find puzzle. Realise solution is fan. Use fan.
and
Find puzzle. Realise solution is fan. Backtrack to Perky Toad. Throw away stickers. Turn fan into sticker. Go all the way back to the puzzle. Use fan.
And the second version is not fun.