Clicking on "Create Tournament", I see the group size loud and clear but it might very well be a question of subscription plan.
Bracket Knockout
Sort:
Silver and Gold cannot create multi-round tournaments so cannot create a group of less than all the players in the tournament.
You can register in these
http://www.chess.com/tournament/1st-march-madness-like-tournament
http://www.chess.com/tournament/firestare500s-tourney
Be warned, tournaments with groups of 2 take longer than "normal" to finish as there are many ties and the tie break does not work for groups of two. It can be difficult to finish as the last competitors have an even higher chance of being tied.
Here is an admittedly extreme example where four players took five rounds to determine a winner. Fortunately AWARDCHESS could complete games much faster back then.
I've tried to get help from erik on this, but I couldn't find what he was talking about. I want to start, or have someone start (any volunteers?) a tournament with 8/16/32/64 people. erik says I should just change the group size to 2, except I can't find the option. Does it take a platinum or diamond member to that? Thanks in advance!