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WIMNI, larger blocks give higher precision to the fft, thus better decision about what is unneccessary.
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actually, it's a trade-off between spatial (transient in audio) accuracy and frequency accuracy. this is why (good) audio codecs based on frequency transforms will have 2 or more block-lengths. short blocks for sharp transients (where time is more important than freq, like percussion, applause, impulses) and long blocks (where freq is more important than time, like highly tonal instruments, etc).
in images, at least with this filter, larger blocks give more severe ringing. seeing as human eyes are less discerning than ears as far as frequency goes, i'd say it's safe to use smaller blocks and keep the edges happy
