I have both the SC32w and SC5w. And for EDC, the SC32w is the winner. You just can't beat a light that is little bigger than a thumb that puts out close to 500 lumens and easily fits into the coin pocket of a pair of jeans. The SC5w in comparison just feels clunky. The SC32w also has the advantage that it has PID control at maximum brightness rather than the three minute timer stepdown that the SC5w uses. So although the maximum brightness is rated lower, it can maintain a higher level of brightness for a longer time. The fact that current draw on a 16340 will be MUCH less at maximum power than the current draw on a AA also helps in this regard. And to top it off, the fact that you can use a 16340 means that you can carry a small, inexpensive charger (like the Xtar MC0) in your car or keep one in the office so that you never have to worry about dead batteries. You can even bring one on a backpacking trip to charge with a solar panel. Yes, the capacity of 16340s is not very good. But the SC32w is actually a VERY efficient light. It makes good use of the energy available in a 16340 (probably because it doesn't have to compromise in order to run AA batteries), and runti,e is not bad when all things are considered.
On the other hand, the SC5w may not 'disappear' in your pocket the way that the SC32w does. But its size and heft actually feels better in your hand if you are going to be carrying the light. And if you just don't like Li-Ion batteries or just want a light that can use AA batteries, the SC5w is a no-brainer. The SC5w also has a longer runtime at a given level of brightness. And as a fringe benefit, the Fenix AOD-S diffuser fits the light perfectly. With this diffuser, the SC5w actually makes quite a nice little camping lantern.
As for why the SC5w is a more popular EDC, I'm guessing it's because of the general dislike people have for the CR123a format. CR123a primaries tend to be somewhat expensive in stores and hard to find. And ordering disposable batteries online is a pain. Rechargeable options are available, and the SC32w works well with these 3.7V Li-Ion batteries. But capacity is low, which limits runtime. I suspect that, if better 16340s became available, CR123a lights might become more popular. Given the energy density of current 18650s and even 16650s, it is entirely possible to make a 16340 with over 1000mAH. But we seem to be stuck at around 500-600mAH.