3rd Edition handled small characters and weapons in a very strange way by giving each weapon its own size category. You could use a weapon your size or smaller in one hand, and a weapon one category larger in two hands. I think that a weapon smaller than your size extra benefits from Two-Weapon Fighting (counting as a "light" weapon, if I recall correctly).
What this meant for small characters was that you couldnt use a greatsword, but you could use a longsword in two hands. Since damage dice scaled with size, it basically amounted to the same thing: a longsword dealt the same damage as a "small greatsword". Where this didnt make a lot of sense is that it implied that small races just didnt make two-handed weapons at all, but instead made their weapons to a Medium standard. You could argue that a human might very well use a gnome's greatsword as a longsword, but the weapon proportions would be off and you still didnt have some things like a Small spiked chain.
This lead to a problem where they would pitch in weapon's like a halfling's kama and a korobokuru's lajatang, to account for how a smaller race might go about using an iconic weapon. They were basically just standard weapons reduced by size, but with a longer name.
Revised Edition fixed this to a point by just making one weapon and allowing you to size it however you wanted to. Weapons were categorized by light, one-handed, and two-handed, so if you found a Small greatsword you knew that a gnome would use it in two hands, since it was pegged at two-handed. I liked this change because it made a lot more sense, though it did add in a complication of what size the weapon was in a treasure find. I suppose it made more sense in that you could sort treasure by where the party found it: in a dwarf fortress, most of its probably Medium.
4th Edition handles things a bit differently. There are no more weapon sizes anymore. They come in one-handed or two-handed, and some have the Off Hand or Versatile property. Versatile is important because for Medium characters, you get a +1 damage bonus when using it in two hands. If you are Small, you have to use the weapon in two-hands, but get no damage bonus. Kind of like the whole 3rd Edition weapon-scaling-by-size thing. This isnt a big deal, except when it comes to powers that require you to use a two-handed weapon.
Versatile weapons are lumped into the one-handed category, since you can use them in one hand. By definition, Small characters can take but not actually use those powers since they cannot qualify for using a two-handed weapon, except for the shortbow.
This has lead some to believe that you cannot play an effective barbarian, since most of the at-wills demand a two-handed weapon. An oversight on the part of Wizards? Well, I recall that people were complaining that the barbarian at-wills were too good since they all offer constant bonus damage dice. A rogue with barbarian training could really mess things up with those. Wizards said that they would find a fix, and so they did: rogues cannot use two-handed weapons and benefit from Sneak Attack. The downside? Well, they evidently overlooked the little guys in the process.
The solution to this is simple: just suck it up and let Small characters use those powers in your game. A houserule? Certainly, but I've houseruled a lot more and a lot more extensively in other games (I had a houserule document that I would email players before starting new campaigns). This is really a no-brainer, and if you're going to wait for Wizards to make it all shiny and official, then I feel for you and your group. You can get all up in arms about it, or you can stop making such a big deal out of it and actually go play.