The applicable rule in Portugal is EU Directive 2003/20/EC, which says, among other things:
Child restraints shall be classified in five “mass groups”:
(a) group 0 for children of a mass of less than 10 kg;
(b) group 0+ for children of a mass of less than 13 kg;
(c) group I for children of a mass of from 9 kg to 18 kg;
(d) group II for children of a mass of from 15 kg to 25 kg;
(e) group III for children of a mass of from 22 kg to 36 kg.
Those groups overlap a bit, plus many seats are valid for two groups. For example, the Argos advert in the OP says the Cuggl Dream is suitable for children from 15 to 36 kg, which means all of groups II and III.
If you want to read the directive in full — it's very dull, but not especially complex — then it's here (click on the PDF logo under "EN"): https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX%3A32003L0020. If you want to be ready to argue with Portuguese officialdom or the car hire company, you could click on the "PT" version too.
Anyway, if you're still awake at this point: yes, you can take the small one and it will be fine. It may very well have a CE mark on it to say which groups it's in (II and III). And in any case, it's a question of what you are confident with. The chances of the Portuguese police pulling you over and fining you for not having a legal seat even if you didn't — and, again, you will have — are very close to zero.
Also, as far as I know, all of this is still in force unchanged in the UK (pending Jacob Rees-Mogg changing the law so that all children have to sit in Nanny's lap), so any booster that is currently legal in the UK is legal in Portugal, and vice versa. That means that when you get home, you can graduate DS from his current seat to the small one whenever you want.