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I've had Sporters with both and I feel like the 16 inch wheel handles better.
The 21 on my bike is narrow and tends to grab on to small grooves in the road. It's nothing crazy or dangerous, but I can feel it wiggling sometimes. Especially on grooved surfaces or grated bridges.
The other thing to consider is the overall diameter, including the tire, is going to be about 2 inches more than what you have now (assuming you'll go with a 120/70 x 21 tire or something skinnier like a MH90-21). To keep the same stance you might want to drop the front shocks 1". You will also "feel more of the road" with the lower profile tires than the fat tires you have now.
I have been considering making just the opposite change to my '05 FXSTD and have been researching how wheel/tire diameter affects trail. In my case, replacing the 21" front wheel/tire with a 19" will reduce trail from 5" to 3.28". I have always thought the handlling of the Deuce was a bit "slow" or "heavy". Not interested in changing the 32* rake but changing front wheel diameter might improve on the handling of the Deuce.
So, in reverse, replacing a front 16" wheel/tire with a 21" should increase trail which will maintain high speed stability but make turn in a bit slower, to what affect, I don't know but might be worth digging in to before making the change. Replacing a 16" front wheel tire for a 21" is a pretty good jump. From what I have read, the "safe" range for trail for the street is 3"-5" so before making the change, find an online trail calculator and see how trail would be affected. Might make more sense to replace the 16" with a 19" to stay in the safe trail range.JMHO.
I dont know what I was thinking when I replied earlier. The bikes I've owned have had 19 and 21 inch wheels on the front. I dont recall ever owning a bike with a 16 inch front wheel.
I'm going to speculate that since the 'stock' size on your bike is a 130/90HB-16
that you have a mid-glide so you could theoretically run a larger 19-21" rim with
a 3" rim width.
Now finding a 19-21" rim in a 3" width might be a challenge, but usually
the tire profiles are a lot shorter. So maybe look for a 130 (width) tire
with perhaps a 70 or less profile & 19 diameter ? (I'm just guessing/spit-ballin this)...
The XL1200V "Seventy-Two" had a 21" front wheel as stock fitment, a complete narrow glide front end from a "Seventy-Two" should bolt straight onto your "Custom".
The OP's bike is the newer Custom with the fat tires like the Forty-Eight. Me thinks the skinnier tires will most likely look a bit odd with the fat front fender, to which he'll have to raise to accommodate the 21". The current fat front tire is a 130, so a close width, like a 120/70 would be a close match. The 120/70 tire is one of the most popular sizes for a 21" wheel, as most 21" the Touring guys use is the 120/70 tire size. I know, as I have one on my King.
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