I actually think larger cases are only becoming mainstream now. They still have a bit to go before they fall out of favour if at all.
Interestingly, my AD tells me older folks prefer smaller cases generally (from the sales he sees). Might be because these guys grew up with 36-40 mm watches. Younger folks go for the large cased watches. Once these younger folks become older folks (with more disposible income) we might even see large cases become more popular than they are now as demand increases.
Who know what the next generation of younger folks will chase? Maybe no watch at all - it might become a smartphone world!
The simple answer is that you NEED one of each. There is no or. There is only and.
Greg