To me, it's not just the size, but all the other things. Apple couldn't do a much bigger iphone in the past without screwing up all the apps. The iphone 5 was a modest increase and changed aspect ratio and there's still many apps out there not optimized for it but at least they're usable. Bigger changes would've made those apps look silly. Keep in mind the iphone 4 was 3:2 aspect ratio 3.5" screen with a color gamut similar to the ipad mini.
To go to 4.7" or 5.7" or whatever, the resolution must be increased significantly to meet retina standards. This isn't optional. There's no way Apple can release a bigger iphone with a worse screen. This doesn't mean adding pixels to change the aspect ratio like the iphone 5 got. This means something similar to iphone 3 to iphone 4 when the res doubled.
Once Apple makes that resolution increase (it's the biggest hurdle because it involved an interim step..changing the aspect ratio first..think iphone 5), then size doesn't matter too much. There can be multiple bigger sized phones that will all meet retina standards.
4.7 or 5.7? It depends in most part to how Apple goes about it. Will one be more "premium" than the other? Or similar to the ipads, will they both be much the same with just size being different? If they're exactly the same, then 4.7" sounds better. But as we saw with the ipads, they may not be "exactly" the same. The Air is slightly faster, has different screen tech, larger color gamut, and louder speakers. So again, it just depends.