Billy Joe had threatened to pull out of the highly anticipated fight at AT&T Stadium in Arlington, Texas ... claiming Canelo's camp was trying to force the fight to take place in an 18-foot ring, much smaller than Billy Joe is used to.

Billy Joe reportedly wanted a 22-foot ring -- which gives fighters more room to move around ... it's less of a phone-booth-style fight.

The two sides announced they had come to an agreement by Wednesday afternoon ... so, the fight is on -- though the official ring size has still not been announced publicly.

We spoke with Canelo (55-1-2) who told us "I don't care about the size of the ring. I can give him the entire stadium. I don't care."

Canelo says he's not going to let the pre-fight drama mess with his fight strategy -- he's still planning on destroying Saunders with a "cool mind."

We also spoke with Saunders who essentially says he feels like Canelo's camp has jerked him around before the fight ... and the ring size dispute was just unnecessary drama.

Saunders is 30-0 with 14 KOs -- and has been touted as the most legitimate threat to beat Canelo since Gennady Golovkin.

There's more ... we also spoke with Canelo about his good friend Ryan Garcia, who recently revealed he's dealing with mental health issues.

Canelo was extremely supportive of Garcia and told us he expects Ryan to eventually return to the ring to fight again since that's what he was born to do.

Garcia pulled out of his July 9 fight against Javier Fortuna -- explaining he's been struggling with "depression and anxiety for some time."

"I pushed thru so many times but I need some time off and I'm choosing to finally get some help with my mental health," Garcia said.