I also have an 11" at my possession at the moment... and I am torn whether to keep it or to sell it. The 12.9 is great with the keyboard and all, but it doesn't fit in my shoulder bag, meaning I can't carry it around that much. Would you keep both tablets to serve different purposes?
If it were me, I'd sell the 11" and get a slightly bigger shoulder bag. It seems like that would be the cheaper option, and I can't think of any situation in which I'd prefer the 11" over the 12.9".
As for the OP's original question, I debated between upgrading my 2017 standard iPad to a 2021 standard iPad, and my 2015 13" MacBook Pro to a 2021 MacBook Air -- or replacing them both with a 2021 12.9" iPad Pro, Magic Keyboard, Apple Pencil, and Magic Mouse. I already had the mouse, so the total cost would be about the same, and then I'd only have to upgrade one device moving forward.
I have a 2019 27" iMac, which I need for my job (primarily working with Adobe CC and Office 365) and some of my hobby apps (e.g., Logic Pro), so I'd never ditch the Mac platform. For some tasks, such as editing Adobe InDesign layouts, there's no substitute for that big 5K display. My MBP, connected to an external monitor monitor, used to be my primary computer. When I got the iMac, the MBP became a backup computer, which I used when I was on the living room sofa rather than in my home office. I used my iPad every single day for watching videos while on the treadmill, checking email, reading ebooks, browsing the web, and so on.
Costco had all the iPad models (12.9" IPP, 11" IPP, iPad Air, and standard iPad) side by side on display. There was no denying that the 12.9" IPP had the best display. For something I use every day and that I keep for several years, I figured I'd get the best. I decided to go with option #2 above. It was the right choice for me. With my IPP, keyboard, and mouse, I can do almost everything I did on my MBP when I'm on the sofa, and the Pencil adds a new tool for creativity. There are a few iOS-related annoyances, such as the inability to sort Apple Mail messages alphabetically to delete blocks of messages from particular senders, so I go to my iMac for things like that. And, of course, for iPad-specific tasks, the 12.9" IPP is a joy to use. Since I work from home and don't need anything more than my iPhone when I'm out and about, the extra portability of the 11" IPP over the 12.9" is of no importance to me -- but when I do take occasional vacation trips, I don't think the 12.9" would be
that much more cumbersome than the 11".
Having been spoiled by large monitors ever since I got a 21" ViewSonic MultiSync CRT in 1995, I could never be satisfied with just a 12.9" display. For the foreseeable future, then, I'll always need or want a Mac, whether it's an iMac or a MBA connected to an external display. But as a secondary-laptop replacement, the IPP/keyboard/mouse combination works just fine for me.