Even though I play classics 90% of the time, I prefer a big monitor in my cabinet (27"). But I wouldn't want one that big in certain types of cabinets, like classic cabinets such as Defender or Centipede where the monitor is upright and right in front of the control panel. Those games were designed around small monitors.
My cabinet is Simpsons style and it is fantastic with a 27" screen. Not only is the screen comfortable for those playing the game, the people standing around it can see it too. A cabinet like this is a must for a 3 or 4 player cabinet, IMO.
Too small can be bad too. I have a cocktail project with a 14" monitor (originally a 13") and it is just a little smaller than ideal. I would probably prefer a 19" in this case, but this particular cocktail cabinet couldn't fit it.
Wade