MikeAZ, this is a tough decision and very personal. I most of us can do is tell you how it went for us and let you decide if it applies to you.
I was going back to riding after many years (20+) off bikes. My biggest way back then was a CSR305, when 750s were "big" bikes. Today, people talk about under 1000cc as "entry level" bikes... life changes.
When I started looking, I was looking for a 750, thinking this would be "huge" for me. I have always liked Kawis, and soon found they don't have 750, now is 500, 800 or 900... so hummm... I found a 900 for sale locally at a very good price (07, around 1k miles at ~$5K), so went for it.
While it did feel intimidating at first, this only lasted the first week or so. After I took the class and refreshed my feel for the bike, and a few careful miles on the 900, it felt very comfortable. Note that you do the class on 250cc tiny bikes and, well, they are very comfy for the class but far from jumping on your 500cc+ bike on real life traffic.
The 900 custom also was different because you sit with your legs more "forward" vs down like on a classic. So don't think the difference is just cosmetic. Riding position and you getting used to it is important to feel comfortable. The bike does NO feel heavy once you get moving.
Just three years later I go around now on a 1600. For long distance hwy travel is just more comfortable (to me). So think about that also, For city driving I THINK a smaller more nimble bike is better, vs long distance doing 70 on a hwy, where solid and heavy works to your advantage. I hated getting blown over by cars going by, very insecure feeling.
I am 5'9" and about 220 lbs and the 900 custom fit me great. While 900 seems intimidating at first, I found I grew into it right away. It wasn't the size, it was the riding position that took a bit of time, and suddenly, I was more used to it than I realized.
Also, for starters, consider a used bike. You will have much less $$$ tied up and, if you decide to trade up, you won't take so much loss. My brothers and I have bought several bikes in the last few years (we ride together) and have gotten really good deals on low millage like new bikes. You can save up to 30% from dealer price for a bike that barely has 2K miles on it and is basically new.
No matter what you choose, please be very careful and work your way up. Riding groups in your area can be of extreme help setting up practice sessions that you can now do with YOUR bike so you can get a good feel for it. When you get on yours, go back and try those U turns and fig 8s again. You will get a a good feel for it and feel more confident.