So many mixed thoughts on this. I've had iMacs since I could afford to buy my own computer, back to my lime G3. Currently sitting on a late 2012 27" iMac which really feels like it's slowed down. I can't run the latest release of Adobe CC now, and the version of Photoshop I can run doesn't work properly.
When they announced the 24" last year, I was tempted but questioned the reduction in size, connectivity and a range of colours I don't really like. The benefits were an undoubtable upgrade in performance, slimmer form factor, better resolution display, better audio. As time went on and they released the M1 Pro and M1 Max, I began to feel that those chips (or better) will end up in the iMac, making the M1 feel dated.
I'm a graphic designer, I've always used the iMac for the Adobe suite of apps. Although I have a place of work with a computer there, the iMac at home has enabled me to do work in my own time (mainly tee shirts on Threadless). Whilst I don't need the performance of someone doing things like 3d rendering, video work or audio work, I do need something that isn't afraid of a 5GB photoshop file.
I'm not sure how capable the M1 is, but the iMac is a proven solution for me. I do wonder if the choice to go for 24" was a literal middle ground for apple to consolidate the iMac range.
I live in a small house and the iMac has always lived in the living room, but as we're going to be selling the house soon, an estate agent advised me to move the "massive computer" out of the living room. Instead I'm using an old 13" 2015 at home, the screen size is killing my eyes!
Sorry for the stream of consciousness ramble, in an idea world they would do what they do with the iPhone range. Colourful iMacs for the masses, grown up coloured iMac Pros and an iMac Pro max for those who want a "massive computer" to quote the estate agent.