I'm curious: why are some hub shells much larger diameter than others? Is it an aesthetic consideration? Or are there cost/functionality tradeoffs? Take for example this Dura-Ace hub -- pretty skinny. Same for a classic Campy record hub. Compare to this much fatter Tiagra hub, or a Phil Wood front hub. I'm just talking standard hubs, not internal gears, powertaps, dynamos, etc. [Addition after DR Hicks answer: nor I am I talking about hub flanges, but rather the barrel of the hub shell.]
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A smaller diameter hub is lighter (and likely cheaper).
A larger diameter hub has several advantages:
A non-obvious disadvantage of the larger hub, when it gets MUCH larger, is that, for 3 or 4 cross, the spoke arrives at the rim at a definite angle. Unless the rim had been drilled at a matching angle, this increases the stress on the spoke where it enters the nipple, increasing the chance of spoke failure. But this is mostly a problem with geared hubs.
It's pretty much tradition to have larger diameter hubs on touring bikes and tandems. Not sure to what extent this is a practical measure vs "expectations" -- the larger flange looks like its built to be rugged, while the small flange looks "light on its feet".
I suspect the reason may be aesthetic. As you've noticed, the cheaper/entry level hubs have large barrels and the more expensive versions have narrower barrels. It must be hard to upsell a customer to a more expensive hub... there's not much to differentiate them apart from the looks.
Personally, the narrow barrels look sleek and fast to me and I might be prepared to drop a few more $$ on them if I'm putting them on a fast road bike.