You're referring to what we call a mini-roundabout. They are legitimate roundabouts and are intended to be treated the same way as a regular roundabout. However, you're also right to say they can be cramped and lots of people do not treat them as they should. The classic being that they just drive straight over them. However, I do think they do work fairly well for roads that are generally not too busy. In this case, I think the previous poster is right, this could well be a situation where a roundabout or mini roundabout would be better. Worth mentioning as well that the UK does not have a situation like this. If we do have 4-way junctions, there is going to be a roundabout or traffic lights. However, also common is that one of the roads is considered more major and has priority over the other. In those cases, the access from minor to major road is via a give-way (yield).