To learn learn the basics of turbo system design and how to size a turbo, read the info in this thread on bimmerforums: e21 Turbo FAQ
To properly size a turbo for any engine you'll first need an estimate on how much air mass, measured in lbs/min, your motor is pumping. To be able to do this for my motor, I first started by modeling the stock 1.8 and 2.0L m10's as best I could in desktop dyno. I was able to get fairly accurate results with dyno graphs that look close to stock. Desktop dyno gave me volumetric efficiency numbers which are needed to calculate the airflow numbers needed to chart on a compressor map.
Stock 1.8L dyno: Stock 2.0L dyno:
Once I had the VE% numbers I needed I put together a spreadsheet which thoroughly calculates mass air flow in lbs/min based on the ideal gas law and basic thermodynamic principles.
You can download this spreadsheet here.
It is catered to the m10 but can easily be adapted to any motor with the right displacement and volumetric efficiency numbers. Here is an example of how to use the spreadsheet and how to chart the numbers you get on some common compressor maps. For the example I used the stock BMW 1.8L and 2.0L m10's. If you have a stock 1.8L, with a pressure ratio of 1.8 (10 lbs of boost) you will flow about 17 lbs/min of air at redline, or about 230 equivalent CFM (good for about 160-170 hp):
The "My 2.0L" VE% column contains numbers calculated based on a ported/polished head and a 280 cam. You can see the basic assumptions on air temp and pressure, turbo inlet pressure of -1 psi, and 75% turbo efficiency to name a few.
If you chart the flow rate numbers on the T3 and TD04H maps, they are not similarly sized at all. The t3 50 trim looks great, you spend a majority of your rev range right in the 75% efficiency island on the map. On the TD04H, you don't even get into the highest efficiency island on the map, instead spending much of your time in the 65-70% range. Lower efficiency means more heat which is your #1 enemy on a turbo car. A larger turbo means higher boost threshold (the rpm at which the motor will start to build boost) and more lag. On a low boost 1.8L, I wouldn't even think about a TD04H. See the maps below to compare 1.8L vs. 2.0L motors on the same turbo. The more air you flow (ei, the further to the right of the compressor map you can go), the more hp you're going to make.
Now lets look at an otherwise identical 2.0L, still running 10 lbs of boost. You will now flow about 19.5 lbs/min of air, or an equivalent 260 CFM.
Now you're in the 190-200 hp range. If you chart those numbers on the T3 map, you're still right in the sweet spot but toward redline the efficiency drops to around 70%, which is OK. With the TD04, you now end up right in the middle of the map which is better, and I MIGHT consider it on a 2.0L. IMO, it's a little big unless you have a cam, port & polish and a well designed system to improve your VE (volumetric efficiency). It would be better on a 2.2L m10.
The great thing about the 2.0 is that you have the option of turning the boost up to about 14 lbs. Now you're looking at up to 220 hp. Add a turbo cam and your volumetric efficiency goes up and you could be flowing up to 24 lbs/min and be in the 230-240 hp range.