For me, 16gb is enough. I always go for the bigger storage spaces on my gadgets and I never fill it. There are so many alternate ways to store things now, that 16gb should be more than enough. I am actively trying to fill my 40gb of space on my Thunderbolt...and Im not even close. I dont really plan on using the Tablet for downloading massive amounts of movies or storing my entire music collection...so 16gb is more than enough.
I currently use ~17GB on my 32GB iPad, and ~12GB on my Evo. The amount of storage I use on the iPad hasn't increased much over time, but storage I use on the Evo's microSD card fluctuates a lot, since I'm always adding and removing music and podcasts.
Since I'm going to switch to the Nexus S when it hits Sprint, I'm going to buy the 16GB Transformer and give it my Evo's microSD card. If I need more than 16 gigs on the Nexus S, I'll offload the excess to Amazon Music Cloud.
If you were an apple owner you would have to seriously consider what size to get, but this one I am pretty sure 16GB will do just fine, and upgrading the memory to add another 32GB is simple and that should probably be enough for most. Unless you want 32 and then add another 32 later. It's cheaper to add memory later anyway so I'd get the 16GB.
I am in the same boat, 16 or 32? I sold my XOOM off (too late to return it) and really liked having the 32GB there but honestly I know I would not max the internal out but I always like to prepare. Still with a 32GB microSD card we should be fine.
I did look over at XDA-Developers and they are fast at work on CWM, rooting etc so hopefully won't be too long.
I will hit Best Buy tomorrow and check it out, want to see it before I buy it.