I think Apple should announce the iPhone 6 (4.8 inch Al) and a iPhone 6C (4.8 inch Polycarb) by June, and then release an iPhone 5SC (4 inch Polycarb) and a iPhone 6S (4 inch Al) in Sept. That way they might have half a chance of meeting demand.
I know a LOT of people that prefer the 4 inch size as they want something small to use (partially due to their hand size) and because they really just want something small to fit in their pocket that isn't so obtrusive, and then there is another crowd that wants the larger screen. If Apple had released two sizes last year, they wouldn't have lost so much business to Scamscum, LG, HTC, etc. because that's a primary reason why a lot of business went the way of Android. I think consumers generally saw the screen size as the deciding factor and the OS wasn't as big of a deal, since they look similar.
I already know several people that went with a S3 that would rather have an iPhone, but the larger screen size was the deciding factor and nothing else.
I think there is enough business to support two screen sizes in both a polycarb and Aluminum, especially if they are 64 bit processors, fingerprint ID, especially if the colors are better looking than the iPhone 5C's. I think the colors aren't as rich as they should, I think more saturated colors and less of the pastel would be a better selling product.
They can always have the iPhone 4S 8GB or 16GB around for the low end market if they dropped the retail price for unlocked for about $350 or so. Hopefully they can still run iOS 8, when it comes out, and if it is still profitable.