I would not trade in the machine you have now. I only have one machine and if it goes down or needs to go into the shop, I'm left with nothing. :( The 1600 is a good machine to take to classes or retreats too since it isn't as heavy as some of them can be.
What is it you like about the new Horizon? Are the features you like going to be worth trading in your old machine for? Several of my friends have bought the new Horizon and the one feature I like is the really large throat area (great for us machine quilters). I love the feature, just not enough to pay the exorbent price they are asking for it.
And like the others, I think it depends on how often you would use the embroidery machine as to whether it would be worth getting or not.