I went to a talk on collecting photography, last week, in DC. On the panel was a well known gallery owner who addressed the issue of size. It came down to "real estate". While most people won't question a 16x20 painting for 3-4,000 dollars, they will question a similar sized photograph at 10% of that price. Larger prints command larger dollars. Galleries have finite wall space, and need to maximize the dollars per square foot. Between rent, staff, and publicity, large prints give them more bang for the buck. If they can sell a 16x20 for $250, a more limited print (of the same image) at 32x40 can go for $2500. This applies to contemporary photographers, not vintage prints by famous shooters.
Once again - about money and not photography or "art" in any sense.
Stop worrying about grain, resolution, sharpness, and everything else that doesn't have a damn thing to do with substance.