personally speaking, i used to be a professional embroider.
i did caskets. had a hoop that was 27" x 29" i loved it.
i say the bigger the better.
look onlike at emb lib.com thaey have nice designs that fitr a 5x7 so i'd say go bigger.
good luck
also, if bigger, you can do jacket back, or multiples in the hoop.
(like lace embroidery)