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I think what the OP is missing is that the colour Kobos did not spring into existence out of nothing. Both the Clara Colour and the Libra Colour are direct iterations on pre-existing models. Coverage, then, is largely reliant on what changes from the old models to the Colour line. The new Libra has a way bigger screen and has added stylus support - both of which make the shift to colorful Kaleido screens a much more significant step for the Libra (especially when the Libra 2 is now discontinued, meaning the Libra Colour now is Kobo's flagship "slightly premium" device). Besides the possible degradation in contrast and clarity in Kaleido screens compared to Carta screens, the differences between the still-available Clara BW and Clara Colour are largely ancillary (multiple highlight colors, colorful covers), whereas the new Libra has more changes (and the screen changes are even more important on a more expensive device fully replacing a prior option).
As for the argument that 6" screens are too small for literature, I quite disagree. There are many editions of (especially classic) books, particularly poetry, that fit on significantly smaller page sizes just fine. I personally have read a bunch of novels on 6" ereaders and never felt like the experience was somehow fundamentally constrained, even though I very much do prefer my 7" Libra. Trade paperbacks often veer into comparably cramped spacing, in my opinion. Also, I feel one cannot discount that given the sheer variety of page sizes, fonts and page layouts in books, most books cannot really even account for how text will appear on a physical (or digital) page in the first place, so there isn't much that is really lost on a 6" screen, unless you're using a larger-than-average font.
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