I'm glad you get it. I'm a bit mystified as to why your contractor went on with that downsizing nonsense as though it were the root of your problem. Something doesn't compute. Either he doesn't get it or some material facts have been left out. Or it could be that I'm the guy using the library computer.
Using the existing coil is fine. Add a TXV and you'll be good to go whether you use a 4 or 5 ton AC. It's unlikely that you'll be using a 3.5 ton. A house that big isn't likely to get by on anything less than 4. The only thing you lose by not replacing the coil is an ARI rating. But an ARI rating is a construct used to steal from the lower middle class and give to all of those above them. A buying decision based on government manipulation may or may not be the best decision.
If you get a new coil anyway, the use of an oversized coil is a VERY good thing to do in dry climates. But again it may or may not come with an ARI rating. And those ratings are so very important in enabling you to get your wealth redistribution check... err, I mean rebate check. See that? I let politics seep in there again. I'm bad that way.