penders - 11:49 pm on Aug 21, 2011 (gmt 0)
16px would seem to be the default font-size on desktop browsers under Windows. But the default font is also "Times New Roman". 16px Times New Roman looks correct. 12px Times New Roman is generally too small. However, 16px (made for web) Verdana is too big for most, but 12px Verdana is "just right". So, whatever font-size looks "right" is very much dependent on the font used IMO.
w3.org uses your browsers default, only specifying sans-serif (rather than serif), which is more readable on screen.