There are currently only 2 process for rescaling models for use in SFM. It is not possible (at the time of writing this guide) to rescale models in SFM directly; or at least no one I've chatted with has found a way to do it.
Both of these processes involve decompiling and recompiling the model you want to rescale.
The first way of rescaling a model is to decompile the model, find a 3D Editing program, such as XSi, 3ds Max, Maya, and Blender, that have plug-in support for importing and exporting .smd files, load these smd files into the editor, extract and convert skins from the .vtf files to add materials to these models, rescale, make changes, create animations, etc to the model, export the changes or animations made back to .smd files, then recompile the model and pray everything works. (This tutorial touches briefly on how to import the SMDs into Blender, but that's it. I may document this method in another tutorial when I completely understand the process later.)
Now for what IS covered in this tutorial.
The second method, and the one this video covers, is the use of the $scale command in the model's .qc file then recompiling the model. (This video assumes that you will use the existing skins for the model that you are rescaling, if you want to change the skins, then there are a few more step required and that is beyond the scope of this tutorial and may be a topic for another tutorial later.)One important thing about using the $Scale method to rescale your models is that if you require the ability to use flex animation for phonemes, eye or face movement, the sliders in your rescaled model WILL NOT work if you use the $Scale method. If this is a requirement for your rescaled model, then you are going to have to learn how to rescale using the first method talked about here and model the animations using a 3D editing program.
Here's the video tutorial:Rescale Tutorial