This post is not a definitive post on the pros and cons of a dual screen vs single screen setup but rather my personal opinion and experience with the two configuration. I constantly swap between both setups and have defined a time and purpose for each setup.
Dual Screen Mode
My personal configuration consists of a 13” MacBook Pro with an external 20” HP LCD display. That is the setup on my work desk. I am an audio professional who does extensive work with audio software for editing and music composing. These software benefit from a large amount of screen estate and I certainly appreciate the dual screen setup.
When purchasing an external display, take note of the native resolution of the display. A larger display does not translate to more screen estate. Cheaper displays run at a lower resolution which just makes things bigger, not allowing more to be displayed at once. My 13” MacBook screen is 1280×800@116ppi while my 20” HP display is only 1600×900@91ppi. Everything looks much bigger and less sharp on the HP display. Try not to save money by purchasing a cheap display with a low resolution, it makes everything look pixelated and oversized.
Single Screen Mode
When it comes to everything else such as writing, surfing the web, etc. I very much prefer the single screen mode. I can disconnect my external display and bring my MacBook somewhere else. The single screen is easier on my neck since I do not have to constantly turn to look at the two screens to find something. Sometimes its like finding a needle in a haystack, did I leave it on the left or the right?
The best part of the single screen setup is that it forces me to focus. With a limited amount of screen estate, you tend to focus only on one app at a time. With 10.7 Lion, full screen apps and Mission Control helps make focusing on the task at hand easily to do. I tend to choose my apps wisely by looking for good user interface design and full screen support. A well-designed user interface will fit to a 13” screen much better.
In the end, it depends on what you are doing with your computer and then decide if a multi-screen setup is really the way for you. Try out some of Lion’s features like Mission Control and see if that helps. Sometimes all you need is to develop a workflow and be more organised. Less can be more.