Pick whatever screen size you want. Then add on 16GB if getting a 21 or 32 if getting a 27 inch. Personally I would do a SSD and a Thunderbolt scratch disk. Otherwise, you could get a hybrid drive to ensure great speed.
Personally, if you can swing the 27" iMac then go for that - its a gorgeous screen.
I'd go for the 27-inch: 3.2GHz with 16Gb of ram
The i7 would definitely be a nice boost in power. However, the i5 is no slouch by any measure. I have used both iMacs and I personally like the 27", but everyone has their own preference. In my opinion the 24" they used to make was the sweet spot.