That's not true, as at the Planck length both quantum and general relativistic effects are equally important, preventing arbitrary measurements over smaller scales - that's the case even for a continuously-divisible universe. In most quantum gravitational theories today the Planck length truly is a minimum possible distance in the same way the Planck time is the minimum possible duration, representing a quantized space-time with hard limits to the precision of measurements.
I'm not an expert in quantum mechanics, but what I was thinking was that to measure the diagonal of a physical unit square you would have to physically build something like a unit frame from some metal atoms for example. Would this still be an intact metal frame if the uncertainty of electron momentum would be on the order of 10E66 or higher? Naively I would think if the electron could potentially have a momentum of 10E66 due to uncertainty it is very quickly anywhere but not part of the metal frame anymore.
Edit: That part aside if you go to even smaller length scales wouldn't the Planck length be a lower bound for how precise a measurement could be?
> Naively I would think if the electron could potentially have a momentum of 10E66 due to uncertainty it is very quickly anywhere but not part of the metal frame anymore.
The electron presumably cannot go faster than light, so if the measurement is done fast, the electron won't move much in that time, even with immense momentum. Also, big uncertainty in momentum does not mean the electron will have large momentum for a long time. If there is some containment device, the electron can have immense momentum for a short time that however changes direction so quickly that the electron does not escape the small containment. For example, atoms are such containment devices; the more the atom has protons, the smaller the region the electron is contained in.
I share the suspicion you have, but I think your counter example is not valid because there is no unit square in (physical) reality. If you would try to measure the diagonal of the unit square you would at some (finite) point run into trouble with the uncertainty principle.