One of my PSK containers is roughly the same shape and size as yours, similarly configured with outside duct tape wrap. To free-up interior space for a few other items, you might consider also wrapping the 5-ft paracord (after the space blanket, your bulkiest item) on the outside. The paracord, being ~1/8-in thick, won't increase the container's outside profile beyond that of the duct tape wrap, and will be about 1-in wide (~6 turns around the container). Might require moving your duct tape down on the container a bit.

You mention efforts to include a quart-sized freezer bag (and Nicodemus suggested a Gerber bag). My solution: included two clear plastic bags obtained from Costco meat/produce department (other stores probably have similar). No "zipper" folding challenges. Fairly sturdy. Thicker, ~3X tensile strength and more puncture-resistant than Safeway's version. Originally 13-in x 18-in. I cut about 4-in from length to reduce bulk, still leaving enough to tie-off after adding couple quarts of water. Carefully rolled, secured with rubber bands, results in small bulk. Use one within the other for added strength. I marked outside with permanent marker at 1-, 2- and 3-quart increments to facilitate adding Micropur tablets. Can double as transpiration bags (being careful to avoid punctures, which could be repaired w/duct tape).

Consider that one of your mentioned alternatives – using kit container itself as a 1-1/2 cup water container – is pretty much limited to immediate consumption (limited storage/transport capability). That, and you're faced with cutting Micropur tablet into smaller pieces for that 1-1/2 cup (or using a larger-than-directed quantity, which presumably won't kill you, but disproportionately exhausts your supply), and then carefully wrapping the remainder to avoid degradation or loss.

Dan