The 80GB and 20/60GB are practically identical, with regards to BC, as of firmware 2.20 or so.
The 60GB has a couple more games it supports, but they both support 95%+ easily.
The reason Sony removed the Emotion Engine (the "EE", the PS2's CPU, but not the PS2 Graphics Synthesizer -- the "GS"... its GPU) from the 80GB was to save money and heat -- and the software emulation of the EE is darn near perfect, as evidenced by the BC of the 80GB.
They removed the GS from the 40GB (and the new 80GB), and thus crippled PS2 BC for those PS3 models.... however Sony *could* introduce software emulation of the GS at some point... and probably will if they ever start making PS2 games available as DLC from PSN. Money is all it really takes to motivate such a thing.
Both PS1 and PS2 games look better under emulation than they do on the actual consoles, due to upscaling and/or smoothing. I've never noticed any difference in framerate, etc... although I could swear that some games that had some framerate drops on the PS1 and PS2, don't have them on the PS3. Maybe I'm just less sensitive to framerate nowadays, with all the bad framerates of many HD games lately.
