So long as it is a microSD card, you should be good.
Your phone doesn't *need* the microSD card to run, but it does need it to store pictures, music files, and if you use "Move to SD" in the application settings, those program links will be broken until the card with the appropriate data is installed.
I would suggest copying your existing microSD card to a folder on your computer, formatting the 16gb card, and then copying the contents of the old microSD card over to the new one.
If you just format the new one and start from there, the worst thing that will happen is that you may have to re-install some apps.