Good read from Sony, thus far everything they've said about the Vita has sounded good to me. They definitely have a good vision of what they want for the thing, and where to take it, they just need to get the execution down now.
I think for me I'd take the bigger screen over portability, as I always got annoyed with the DS screen. I never had pocket space for my DS so I've kind of wrote off carrying these things in my pockets anyway, can just go in my bag.