Good question, Paul!
In your explanation, you write that log backups are about the same size as when full recovery had been uses. This matches my expectation, but in Books Online, it says:
"The tradeoffs are bigger log backups and (...)"
ms-help://MS.SQLCC.v9/MS.SQLSVR.v9.en/udb9/html/8cfea566-8f89-4581-b30d-c53f1f2c79eb.htm
Is this a documentation bug?