Smaller frames
It has been said that the smaller framesets will always handle better than larger frames. My personal experience fully supports this contention. I spent many years on frames that were too large given my body dimensions.
When I started riding seriously in the 1990s, the popular position on the bike was long and very stretched out. During those years, I found myself focusing on top-tube length when looking at frames. This of course was before the advent of compact frames with sloping top tubes. I would just look at seat-tube angle and top tube length and choose a frame that stretched me out. Of course, the entire time I was setup l like this I suffered from pain in my hands and low back from my body trying to support this long stretched out position on the bike.
Back then I was running with minimal saddle to bar drop maybe 4 to 5cm. I had my 5’10” body (84cm inseam) stretched out like I was Greg Lemond. Little did I know at the time that had I more closely analyzed my position on the bike and acknowledged the various pains I was experiencing I would have realized that there was something wrong with my setup.
It wasn’t until early 2003 that I decided to try riding smaller frames. This decision proved to be a revelation. Everything about my fit changed for the better. I was able to get my fore/aft balance set perfectly. Granted, I had to lower my saddle to bar drop in increments but once I got to 8.5 cm of drop I was more comfortable than I had ever been before owing in part to the fact that I was much better balanced front to rear on the bike.
There is no reason why going with a smaller frameset has to result in discomfort. In my case I am much more comfortable on the bike than before.
Going smaller with more saddle to bar drop was truly a revelation that changed everything about my cycling. The bottom line is, I could go faster for longer and have more fun on the bike. If your goal is to go faster, further and have more fun doing it then going smaller is the way to go.
Of course you need to look at all aspects of frames that you are considering with special attention to stack and reach. Don’t assume going with a smaller frame and running with more saddle to drop is going to lead to discomfort.