Pretty much comes down to the old debates between French Fit, Eddy Fit or contemporary competitive fit. There are fairly subtle differences that we're likely to notice only on longer rides or bike handling on fast technical sections of pavement where a bike might feel either twitchy or sluggish, depending on stem length and other issues.
At 5'11" with 33" inseam (weight 150 lbs, but not really relevant to fit), my bikes range from 54cm to 60cm. The 54cm comfort hybrid/errand bike is really too small but it's only for short errands or if a friend wants to borrow a bike. The 60cm hybrid is a little too stretched out so I compensated by replacing the flat bar with albatross swept bars. I kinda like the higher position riding in traffic, and I can still dab a toe down at stops while seated.
My road bikes are a 56cm Trek 5900 (old school 1993 monocoque carbon fiber but conventional diamond frame) and 57 or 58cm '89 steel Ironman. Both are fine but set up differently. I made adjustments gradually after longer rides, at least 30 miles or more. And I'll continue making adjustments as my conditioning changes. Last year I was recovering from injuries (hit by a car) so for about a year I went for comfort at the expense of being higher and less aero. Now I can handle a more aero position, lower or more stretched out.
I was a little too stretched out on the 57-58cm Ironman with the original stem (120mm, I think). A 90mm stem and raising the quill stem a bit helped. The handlebar is about 2" below saddle height. Not too stretched out or too high. It's pretty much perfect so I'll leave it as-is.
The 56cm Trek 5900 was way too stretched out with the original 140mm stem after I switched from the original aero brakes (brake only, with downtube shifters) to brifters/integrated shifters with longer hoods. Swapping to a 90mm stem helped, although now that my flexibility has improved I might try a 100mm stem. And switching to compact drops (FSA Omega) helped with using the drops for longer stretches -- on good days I can stay in the drops for a couple of miles or up to 10 minutes. With the original deeper crit type drops I could handle only a minute in the drops. The stack is the same as the original, with the bar about 3" below saddle height. The overall fit is the same as Lance Armstrong had on his late 1990s-early 2000s Treks -- a bit stretched out and with less bar/saddle drop compared with the current standards. Reportedly he preferred a slightly larger frame to be more stretched out and aero.
I definitely couldn't go smaller than 56cm on a typical road bike frame with my leg length and riding style. My thighs are slightly longer than usual and I'll bang my knees into the handlebars when standing to pedal unless I'm very careful about stem length. As it is, my knees occasionally knock against my headlight if I mount it below the handlebar.
But it's tricky using stem length to compensate for frame size. It can really affect handling in tricky situations. I've noticed it more on the 56cm Trek with 90mm stem. There are some dips with rough pavement on some fast routes I ride often and if I don't pick the perfect line there's a scary moment of wobble. That was less a problem with the original longer stem.