If this was a touch case I would still be pumped because they would never make a touch bigger and better then the iPhone. They may make it on par with the iphone (aesthetically speaking), but never nicer. So no matter what the case is for, it still means iPhone 5 will be one mean SOB!
Bigger doesn't necessarily equal better. And a size increase in the iPod doesn't mean the iPhone will get the same increase. If apple can squeeze a larger screen into the same size iPhone, then I am ok with a larger screen under these conditions, but I by no means need a larger screen and I do not want the iPhone to become significantly larger and less-pocketable.
Not counting the uber-geek spec-whores among us, I think the average iPhone user out there is happy with the current size. The women I know probably don't care either way, but the men definitely would oppose this as they do not want to carry a man-purse for their phone.