The previous discussion just shows how just calling a car "large" or "compact" can be misleading. The Model 3 should be much smaller than the S externally, but very similar in passenger space. It will have far less storage space than the S, though.
For me that will be ideal. The S is too large for me externally (it barely fits in my garage at all, and I often struggle getting into parking spaces), and I don't need the storage space (I can always use my wife's SUV). What I value is a comfortable drive with great handling, and the smaller dimensions should improve the handling without compromising interior comfort.