Would a food grade 5 gallon bucket be too big to use for a 2 gallon batch? Or would the CO2 just take longer to fill the head space?
Should be fine.
For primary fermentation I don’t think there would be an issue. I do 2.5-3 gallon batches in my 6.5 gallon bucket and haven’t had any issues. Of course, the small batches don’t really last long enough where I could comment on whether long-term shelf life may be affected.
It’ll be fine for all phases of fermentation, no need to transfer it. Yes it will take longer for the co2 to fill the headspace, but it will blanket the beer as normal.