A few here are referring to the compromises that you have to make when running low profile winter tires.
I sorry but I do not understand what they are other than the cost of the tires and wheels. Can someone shed a little light on it for me.
Aside from the cost and potential damage, the availability of winter tires depends on the size/aspect ratio. If you're looking for an agressive winter tire for handling deep snow it might be unlikely to find it in a 205/50/17. On the other hand, if you're looking for an H-rated or similarly sporty winter tire that has less of a dry handling compromise then you should be fine going with the 17.
So, it all comes down to what you want in a tire:
Deep snow performance? Go with a 16 and get an agressive winter.
Highway/Handling performance? Go with a 17".