I think that there are other parameters that count as much as displacement -- that really is only a portion of the equasion: Control surfaces and effectiveness, sea states you're really going to be using the autopilot in; balance of the boat in powered-up sailing mode; and interface issues.

The interface issues include whether you'll just be using the pilot in compass mode; NEMA (GPS driven); and/or apparent wind.

I too believe that the usual problems stem from undersizing. I don't think much of a marginal choice based on advertising recommendations.

If you locate the pilot below deck -- you may spend a bit more, but it will be a lot more reliable.