I wouldn't mind a bigger screen but don't really want a bigger phone.
Ideally, I suppose, an edge to edge display and a wide/taller aspect ratio would be the way to squeeze the most screen real estate out of the thing without increasing the phone size.
Developers would be pretty quick to update their apps to the new ratio and black bars down the size would be OK for any apps that didn't make the change.
I think the most likely outcome will be that Apple will keep the aspect ratio and either implement an edge to edge design or increase the phone size slightly.
I doubt if they will ever create a brick like the Galaxy S3. I hope not anyway. Unless they keep the current iPhone and call it the iPhone mini.