I find shorter top tube work better as there's little change you can do with the stem over the saddle height, the problem with shorter stem is that it affect the handling of the bike, so I managed to find the Colnago with the right TT length and ST/HT angle, so I can use a 100mm stem which I find perfect on that bike.
Just a quick 2p
If you go down a size on a frame, it will often have a steeper STA causing you to push your seat back some (1cm per 1 deg STA, or something) anyway. Also a shorter stem has less effect then you might think, as while you will need to move the bars less distance for the same turn (by a tiny bit), you will also have proportionally less mechanical advantage.
Just a quick 2p
If you go down a size on a frame, it will often have a steeper STA causing you to push your seat back some (1cm per 1 deg STA, or something) anyway. Also a shorter stem has less effect then you might think, as while you will need to move the bars less distance for the same turn (by a tiny bit), you will also have proportionally less mechanical advantage.
Basically its all 'swings and roundabouts*