If you read the printed sign hanging by the Betta cups at my local Wal-Mart you will see that it says "blah blah blah muddy water blah blah rice paddies...breath atmostphere oxygen..."
and I quote "...so they not only survive, but they thrive in these cups!"
Yeah, they are THRIVING!
Personally, I see no problem with a 1 gallon tank, but if you use the light you'll get brown algea enough to completely cover the inside of the tank almost every day. It's a pain to clean and will be a complete headache. I guess if you don't want a light you'd be alright.