Speaking of unique use of caves...we just at at Alux in Playa del Carmen a few months ago. Great restaurant in a live cave as well. Very cool if you don't want to travel to Turkey for this experience.
There is a similar looking one down in Jamaica somewhere.
Katy: Looking at the height of the bed and the wall closer to the viewer, I doubt if the room is as small as it appears. The back part of the bed room where the lamp is located may be a different story.
Even then if you notice the chair, and the height of the part you actually sit on, I would assume the sitting part would be lower than the waist so if you raise the chair to the height of an average sized person's waist line, it looks pretty spacious.
I'm not sure if it's the Gamirasu, but it's in Goreme, Turkey in the Cappadochia region. I stayed down there in a similar cave hotel in October. There are many to choose from in all price ranges and luxury levels.