That's a question only you can answer. Some people are very happy with a 4x4 hoop and never feel the need to go bigger, but I think most machine embroiderers who start small quickly outgrow the small machine. I started with a Janome 200e with a 5.5" square as its largest hoop( I did my first quilt labels on it-they came out beautiful) and it was only 2 months before I bought another janome(350e) with a 5x7 hoop. That lasted me two years until the 500e came out with the 8x11" hoop. I also have 2 Brother machines that use a 4x4 hoop but those were bought specifically for the built in designs.
All that being said, I find that I rarely use the largest hoops. I do so much embroidery for the little ones and babies in the family that the 2", 3", and 4" hoops get the most use. But it's nice to have the bigger hoops when I need them.
oh, and another thing - the Brother PE770 was on an Amazon flash sale a week or so ago for almost what that Costco machine is selling for. I'd watch Amazon every day from now til after Christmas because prices change daily and there's another Brother machine that is the twin to the 770 that may go on sale. It's the Designio 820. It comes with 3 hoops and enough thread and stabilizers so you can start embroidering right out of the box. It's every bit the work horse machine as the 770.
Cari