When it comes to monitors, bigger is indeed better
Just an observation: I'm much more productive using my 1280 x 1024 Dell monitor than I am on the 1024 x 768 monitors on my laptop and alternate desktop box.
Having that extra real estate makes it much easier to see more of a document, do a photo edit, etc.
It's especially helpful in mail clients. I was writing about how I don't use a mail client much on my laptop, and it occurred to me that I just can't see enough information on the screen in 1024 x 768 to make it worthwhile; I'd rather just use the Web interface for mail.
But on 1280 x 1024, I love using Thunderbird (and it's much quicker to do mail that way anyway).
I don't always think bigger is better -- although I am a big proponent of desktop PCs over laptops when it comes to productivity -- but when it comes to your monitor, a bigger screen is a huge help.