What's your location? A heat load calculation is the only way to determine the proper sizing for your home--I wouldn't accept any other method. 3 tons still sounds huge for 1200 sq. ft. I have 3.5 tons doing around 3500 sq. ft. (incl. finished basement) at my house with no real issues--cools to 72* even in the 90s. Heat load calc is the answer to your question. : )

What they're probably telling you here is not that the new system is better but that your old system was oversized, and on the surface of it that seems like a possibility, since 3.5 tons is a lot for 1200 square feet in most cases.

Someone is going to tell you to have them due a Manual J load calculation, and that's certainly good advice, but for the sake of discussion, how much does your current system run to keep the house cool on the hottest days? If your old system is running all day on the hottest days, you may have a house with high heat gain (possibly older construction, many windows, or high internal heat gain from living activities). But if your current system has run intermittently even on the hottest days, and I'm guessing that's the case, you probably have room to reduce the sizing, and this would give you better humidity control and reduce energy consumption.

I live in Las Vegas but have been assured that a 3 ton unit is just right for my 1200sq foot house. My current 3.5 unit, during really hot days stays on between 20-30 minutes, turns off between 5-10 minutes. And the house really doesn't stay that cool (duct work is fine).

And from what I've been reading, it is/was typical for house manufacturers to put in a HVAC system that is 1/2 to 1 ton bigger than necessary.

So I'm starting to think that a 3 ton unit would be best, and I understand the Manual J cal would be best for anyone.

I'm also looking at the 3 ton Lennox XC21. Does anyone use this unit and what do they think?