I think that even with the content already in Chapters 1 and 2, there is plenty of content that it makes sense to split to separate pages.
In terms of Castle Town, the Party Dojo already has plenty of content — enough to split to its own page. I think the Café could probably use its own page too, and expand a bit more on how it interacts with the Recruits mechanic. Potentially there’s a case for splitting Ralsei’s Castle, but I don’t think it could benefit as much from having its own page as the other two.
For Hometown itself, I think the main sublocations that could be split off are the ones that have Dark Worlds in them (School, Library, Toriel’s House). The only other Hometown location that really has much text at the moment is the Police Station, but I don’t think it necessarily benefits that much from its own page.
I think NPCs are the real area that there should be more splitting than there currently is. Especially Hometown NPCs, where there are quite a few fairly important characters who don’t have their own pages right now—characters like Jockington, Catti, Temmie, and Pizzapants. Beyond that, there’s a handful of characters that are not as important, but have a substantial amount to say about them who could also merit their own pages: Snowy, Bratty, Catty, Onion, Father Alvin, Napstablook, the Wet-Nose Bandits (a single page for the whole group), etc.
Likewise, I would argue that pretty much any of the named NPCs who move to Castle Town probably deserve their own pages, rather than being treated as background characters in a specific location. Most of the Castle Town NPCs are enemies so already have pages, so I think the main characters that this would end up giving pages to would be Pippins, Battle’s Master, the Royal Coat Rack, little ball, and the worm.
Personally, I think the only characters who should really be confined to lists without getting their own pages are characters that don’t have proper names, or literally only appear in one location in a single chapter (e.g. Fommt). Characters are often going to be found in different places in different chapters, so grouping characters by location is going to work less well than it did for Undertale. I would much rather lean towards giving characters pages when there’s a question whether they should be on a list page or have their own.
I do think GIGA Queen makes sense as a separate article, because it refers to the mecha specifically, not Queen herself (even though it looks like a large version of Queen).