My leagues have the same setup as you. Although based on what's mentioned on the boards on the weekly WW gem threads, it seems most ppl here have their roster sizes at 16. I personally like 14 because it makes bye weeks more interesting and adds more wheeling and dealing throughout the season. Also makes the FAAB more interesting every Tues night.
The more worthwhile players on waivers, the less teams have to deal with each other to fill their needs. Smaller rosters lead to less wheeling and dealing, not more. Unless by wheeling and dealing you mean waiver moves and not interaction between teams.I tend to prefer larger rosters. I think it gives the more skilled owner more of a chance to differentiate himself. The more players that are available on waivers, the less you need to understand how to figure out the value of players in your league. I play in some leagues with enormous rosters in comparison, though also with larger starting lineups. You can tell a lot about an owner's skill level by looking at his roster makeup. If he's carrying backups that aren't any better than what could be had on waivers (like at IDP) while passing on players who have a better chance of moving into a significant starting role (guys who turn into that year's Vick, Hillis, etc).
If those same players have to sit on waivers until everyone has heard the news or seen the result that the player is performing, the owner who was able to identify them in advance as the best breakout opportunities loses ground to the owner who couldn't but who can pick him up from waivers once it is more obvious.
I do think the waiver priority where you keep it until you use it helps at least a little there, but larger rosters with that kind of system are still better at giving skill a chance to win out than are smaller rosters with that same kind of system.