How much difference does it make for small HD screens? Is it so much better?
For me, it depends on the game. Resident Evil: Revelaitons is the best looking game I own on 3DS. I don't really notice the resolution and some of the shortcuts Capcom made unless I stop moving entirely and look around. How often do you do that in a game? It's also really dark. In games with a brighter palette like Super Mario 3D Land, I notice more. I don't think 3DS games look bad though I wouldn't have said no to an iPhone-like screen.
Nintendo were planning a larger screen 3DS model so I think they should have minded resolution and pixel density more. When you blow the screen size up 90%, those things are far more noticeable. I really like the 3DS XL and will eventually get one. However, you can definitely see the difference.
Wholeheartedly agree. Revelations looks awesome (and apparently, is a FAR superior game to the new RE 6, *chuckle*), and looks as HD as they come. The 3D antialiasing has a big hand in that, I bet. There are loads more examples I can think of, like Ace Combat, Rhythm Thief's cutscenes, DOA Dimensions in 2D/60FPS mode, just off the top of my head.
What would look nice in HD is Netflix, which does not look great on the 3DS. It's serviceable, especially if I want to watch SOA while I'm doing the dishes, or something like that. But it would be nice if Netflix looked as good as on my ipod touch. But then again, it would be nice if my Ipod touch wouldn't take 2 full minutes to buffer and drop out after watching anything for more than 10 minutes. Hence why I don't watch Netflix on that piece of junk.