Larger iPhone mock-up from Marco Arment
This would go against everything that Apple has said so far about the optimum size for a smartphone. Even Steve Jobs said this back in 2010.
On hindsight, Jobs was clearly wrong, as Samsung sells bucketloads of the Galaxy Notes, and everyone is scrambling over each other to release bigger smartphones. Check out this CES roundup from Engadget to see what I mean.
Going with a bigger screen would also make Apple look like it's catching up with the competition, rather than setting the bar in the first place, so I'd be skeptical that this would happen.
But, frankly, I'd buy a 5" iPhone in a heartbeat. ;-)
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