You can see the preset cache size by placing a finger on the edge of the front screen of MC app and sliding to right and you will see a menu. In that menu is Settings, and in there is cache size.
The cache is used for a few things as I recall. First, is if you want to download anything in to the MC app's Download folder as that is where it is stored in the cache. Also, if you are streaming a video, that is where it is buffered, and 1GB can't do the job in either case.
I only have a 16GB iPhone, I store no music or videos in it, I prefer to stream media to it like music and video. I allot 8GB of my 16 GB phone storage to the set cache size. Large enough to buffer videos well, and not loo large to be an issue. The cache can always be cleared, but I never have to usually unless I want to delete stuff I had downloaded with the app and stored in Downloads.
There you go.