At a portfolio review last year I asked a gallerist about size, and the answer was that, in the NYC metro area at least, people do NOT have gigantic walls to decorate. In fact, the bulk of this person's clients were apartment dwellers with taste and enough money to buy art, and were quite content with modestly sized prints.
At that review one reviewer suggested I either make my (typically 10x10") prints either much bigger, or much smaller. I continue to make them now as I did before.
I also think that some photographers are motivated to make huge prints in order differentiate themselves from amateurs with typical digital printers who can grind out inkjets with as much skill and quality as they can. But, the "pro's" have spent big bucks to be able to do what the amateur can't. There was a TV ad for an entire digital workflow from "capture" to inkjet print performed by a four year old child. That sort of thing must really make the digigraphers uncomfortable.