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If portability is a priority, than I'd get the regular 3DS. On the other hand, if presentation and battery life are higher priority, I'd get the XL. The XL uses newer screen technology to reduce glare and such and has an extra 1/2 to 2 hours of battery life in addition to the bigger screens.

As for DS games, they should all be playable on the 3DS. The only exception is the Guitar Hero games, which needed a special peripheral that simply doesn't fit on the 3DS.