How to clean up my iMac...

We don't know all of your needs but based on what you've told us I'd recommend the drive type be the deciding factor if it were me.

I'd certainly not consider a platter only drive especially if it involves a 5400 RPM drive that comes with the 21.5 models. A Fusion drive with a 7200 RPM platter drive as in the 27" iMac is fine (my primary Mac is exactly this), however, a SSD only Mac will outperform it all else being equal. No question about it.

Unless you're into gaming or really heavy duty video editing/rendering, 16 GB should be fine. And, a 512 GB SSD would be great, but if you're careful and park unneeded stuff on an external drive, 256 GB should be ok.

I started all of this so, you wouldn't have to start this very tedious and time consuming project and in the end, did all of that only to wind up with an iMac that would be slower than the previous iMac you owned.

You should be all set now.

Realistically, a 27" inch only gets you a bigger screen and better resolution but that's useless if the machine can't keep up with the demands you and your software put on it especially if it requires forgoing a SSD only option due to cost (take it from me who owns all three types of machines)

Based on your usage I fully support Babowa's recommendations for a 21.5 with SSD drive only (not a Fusion drive). It's the biggest bang for the buck.

I don't understand.

Three volunteers, myself included, gave you the short, correct answer.

Beef up a 21 inch screen iMac, get a 256 or 512 GBs internal all SSD, 16 GBs of RAM.

You get the best price to performance ratio, as well as, some good future proofing.

FYI,

At some point, no matter what size SSD you decide, you SHOULD purchase a large capacity external USB 3.0, 7200 RPM hard drive, at some point, both for storage AND for performing regular system/data backups.

Everyone who uses a computer should always have an externally connected drive, at least, for system/data backups!

Yeah, we don't know if your budget has limitations or how much data you need to access daily so our recommendations are based on what we know about your workflow you've described so far. They're pretty definitive so unless you've not told us about some insanely intense number crunching application you use Babowa's recommendation for a 21.5 with either a 256 or 512GB SSD drive and 16GBs of RAM is going to give you a solid performer that's incredibly fast with no unwanted or unneeded frills that bring no advantage.

The extra 8 GBs of RAM he recommended vs the factory supplied 8 GBs gives you a bit more headroom in case you've left off a memory-intensive app you currently run or might buy in the future. His is a solid recommendation that would cover all but the most specialized use for this Mac.

I hope I'm thinking straight but in my view, the long haul is the only way. I know of no program that can interpret what you need to delete, except the old standby, the brain.

What model iMac did you purchase before you begin this intensive process?

Yeah,

The 5400 RPM hard drive is going to be a bottleneck for this iMac.

What are you planning on using this new iMac for and is speed an issue for you or not?

So, email, Facetime, web browsing, light image editing?

What kinds of apps were you using on your old iMac?