going from 55nm to 28nm would improve efficiency by about 4x at chip level (perhaps more if they revise the design at all). The overall efficiency might increase by 3.5x to account for the power use of everything else in the BOM and the control modules
and you have to get over the idea that the S2 is 'too big'. The S1 cost 4.75BTC at first, now its about 15% of that price. The S2 is due for a pricedrop to a more realistic ~5BTC very soon if it want to stay relevant. This will drop to 3.5BTC after a month.
The biggest advantage in the S2 is some clear design improvements. these include: space for ATX psu, rack-mounting, denser chip arrangement, and 140mm fans (these are VERY good fans, more airflow than from the S1 fan but less RPM and noise)
If they come out with a new chip, I expect they will maintain the S2 profile, but pack in 4-5TH of chips.
re OP on "too big". S2 is overpriced for its power and hashing at ~$3.2/GH with S1 currently at $1.4/GH. S2 has problems of boards falling off the rails during transport (or was it fixed already?). I don't want an expensive unit where reliability might be a problem (with flash cards on restarts, etc.). Modularity is very important, I agree with OP.
the price/GH is definitely a bit off in the S2. (keep in mind though that it uses 10x the chips as an S1, which is *almost* logical if the chips are the biggest cost). IMO it should be 5BTC right now at most, if not 4.5BTC.
my unit is a batch 2 and i had no issues in shipment or in usage. (~980-990GH stock was a smidge low of the 1TH). the rails that hold the modules are fine on mine and do the job well enough that i really wonder what went wrong with the damaged units some people received. they are small plastic slides on a metal brace, all of which seems firmly put together in my box. The PSU was new 1000W enermax GOLD, or looked like new. I have not had issues with the SD card on reboots or power cycles, but my bitfury unit used to so i am not surprised that the some of the S2 sd cards have corrupted when using cheap cards.
The S2 is rack-mountable. the hashing boards are removable (if swapping them is ever needed). I would say that is important compared to the havoc of dealing with over a dozen S1 units and their seperate power supplies and difficulty stacking. 1!1!1!1 would testify to this - all you need to do is see the difference in his racks for S1 units and S2 units. one rack is clean and gorgeous, the other is a hodgepodge of zipties, server PSUs, and power/ethernet cables.