Also what is the smallest tank you can get for them? And what do you need to put in the tank to make it cycle properly? Sorry for all the questions but I want to make sure everything is good this time around.
The 24 gallon nanocube, or 29 biocube would be suitable. I would take out the actinic light and replace it with a 10k or not replace it at all. You would also have to close off any cracks between the main tank and the back that houses all the filteration.
I kept a dwarf in a 10 gallon for a couple of weeks, and it seemed very unhappy. Of course it was moved from a 75 gallon, but in the 75 gallon, it was also contained in a critter keeper but still was much happier than in the 10 gallon. If you go this route, you might try adding a tiny peaceful fish. Mine seemed to enjoy watching the fish swim around it.
I'm just speaking from my own personal experience. Not stating fact. My dwarf O. Mercatoris loved hanging out on the side of his critter keeper following the fish around. He might have been stalking them. He might have just been keeping an eye on them. He might have been chasing them for fun, as they do exhibit play behavior. Either way, it was one of the few things that kept him active besides hunting.
Hahah, well, that's a good question. I can't prove or disprove his "Happiness".
I say he was unhappy, because in the 75-gallon he would come out of his den and hunt or explore. Whether or not I actually saw him moving around, I would always see the remains of his hunt from the night before, or rearranged shells. In the 10 gallon there was no evidence of him EVER leaving his den, and I put in several things for him to play with. The few times I saw him eat in the 10 gallon, he only reached out of his den to grab a Fiddler if it actually stepped INTO the den. Never once did he leave to get food.
I returned him to the 75-gallon after about a month of this, and the hunting/exploring behavior began again.
I would be inclined to say yes. Probably closer to 30 gallons so there's room to explore. But mainly, I would just suggest that you add something for the Octopus to interact with, but is definitely not going to harass it. Unfortunately, any fish with that disposition is also potential food, so keep that in mind too.
Starfish are pretty limited as far as interaction goes... they pretty much only interact with their food, as they climb on top of it to eat it. They would make a good tankmate though, as long as they aren't strictly carnivorous. I have read horror stories of people losing their Octopus to a starfish because it was trapped in a hole, and the starfish killed it. I'm considering removing my Bahama Starfish because when my octopus eats on the glass, the starfish tries to climb on top of my octopus. It is likely only trying to get at whatever the octopus is eating, but since starfish turn their stomache inside out, I don't trust it much.
Considering O. Mercatoris' are so tiny, a Clown Goby, Firefish, or Neon Goby would probably be no threat what so ever. I notice a lot of Clown Gobies and Neon Gobies are fairly cheap, under $10 usually, so it wouldn't be a huge loss if it did end up being killed.
This is just a suggestion though. I by no means am a seasoned Octo-pro.