An interesting subject, one often raised by fellow enthusiasts. We're a size-addled society anyway, we Americans, whether it be cars, sports, or even food. Your premise, Gaz, that we'll see a trend towards smaller cases presupposes that larger cases now predominate. I don't think this is the er, um case regarding the case at all.
Most cases are still in the 38mm-40mm range. They often get less publicity than their larger brethren, but a quick survey through any of the tick-tock annuals proves my point. If I had to bet, I'd wager that the most common wristwatch size is 38mm, not a big 44mm or 45mm, which many people still shy away from because of style and fit considerations. Indeed, even though there is now reportedly a trend towards larger case sizes for women, the overwhelming majority of women's wristwatches fit the definition of smaller not larger.
Take three of the largest and best known watch manufacturers: Patek, Breguet, and Vacheron. By any measure, most of their offerings fall in te 38mm-40mm range. And so it goes with most other manufacturers too. While we might see a small increase in the number of smaller models, compared to year's past, I'm doubtful there will be enough of them to call it a trend...
It's all fine by me. I like bigger watches ,even on my 7" wrist. My deteriorating eyesight simply makes it more difficult for me to read all the small type and markers on the dials of 38mm and 40mm watches. Sure I own a few - how could I not given their prevalence in the market? But, faced with ever more choice in the sweet spot of 42mm-47mm, I'll continue to opt for the larger sizes.
bill