Yeah, it's clear that Nix has not been optimized to run on resource constrained devices. I run NixOS on a Raspberry Pi with 1GB of RAM and had to enable swap to prevent Nix from running into OOM situations. Any system with more memory than 1GB is usually fine in my experience though.

To run it on systems with low memory, I suggest performing any custom builds on a separate machine.

In "normal" circumstances you don't generally have to do any builds at all - (almost?) everything should come from the binary cache. To be doing all these rebuilds it sounds like you're customizing packages, which is already something other distributions don't tend to let you do at all.

That’s strange, are you actually compiling packages or the evaluation itself ooms? Because if the former, you may help it by limiting concurrent builds.

you're probably mistakenly using nix-env -i, rather than nix-env -iA