what is a good image sensor size and ISO ratio for a camera?

The ideal image sensor size is "full frame" or 1:1, which is the equivilent to 35mm film. (unless, of course you're moving to medium or large format, but that's not in the "consumer" world)

Unfortunately, even in the consumer world, you'll need something like a canon 5dm2 for about $2200 to get to a full frame sensor. Most DSLR's will have a sensor size of about 1.6:1, which is perfectly acceptable for most any situation. Canon's DSLR line, starts with the EOS Rebel XS, which is Under $500.

If that's still too much money, now you're down to the world of Point & Shoot cameras, which will have sensors in the range that you're talking about.

They're still very capable of taking pictures, but as you said...Bigger is better.

As for ISO, most cameras will be able to shoot iso100 through iso1600

some cameras will have extended iso to 3200 or even 6400 or beyond, but 1600 is all that's practically necessary. Beyond 1600, the noise or Grain in your pictures begins to get extensive.

A sensor that is small has the pixel cells packed together densely. There can be overspill of light and electrical interference from one cell to its neighbour, this causes noise. Noise is what destroys picture quality. The difference between your hypothetical camera sensors if they are in a compact camera will be negligible. There will perhaps be more difference if the camera has a larger sensor such as in a DSLR I use a DSLR: nikon d40, 6.1mp a pocket camera by Casio and a couple of other compacts ranging between 8mp to 16 mp. The Nikon outperforms the compacts. If you zoom into the picture the nikon pixellates sooner as you would expect, but without exception the others lose definition and noise increased well before the pixellisation. Interestingly I have a Nikon D3100 camera too and theres not much to chose picture quality wise between the two nikons. I will just mention I am talking about image quality where it relates to pixel size. Other factors are involved such as onboard image processing and lens quality. A bridge camera uses a compact camera's sensor. The Nikon 1 has a sensor smaller than some phones. There must be a serious amount of processing to give that camera a good image. Specially considering its price. I hope this answer is simple enough for you. Get a DSLR Canon or Nikon, both are excellent, even entry level models (such as mine)