well... YES the 1 gallon can fit a baby betta. But they need heaters and good luck not cooking the baby in the one gallon
Why a heater: Baby bettas bought from the store have a compromised immune system. Because they come from wholesalers, they aren't as healthy as one some of the breeders on here raise. The fry will need a variety of foods, for best results, constant cleaning (for one gallon, clean EVERY day for maximum growth) and warm water. A filter will push them around, I am not sure about the under gravel one...