Compact pistols as others said already, are more easy to conseal. There is no need to let anyone know that you are carry a gun anyway...
Also, they are lighter and have benefits of a small pistol.
Ok, HK USP Compact model, its not that compact, but as i hear here from Police Officers, some of them found the Standard USP to be so big. Here they prefer the compacts models mostly.
Maybe they don't want to cause serious wounds to suspects. (The police here uses the standard caliber of 9mm)
Personally, i believe in the quote "Bigger the gun, Bigger the fun" and other quotes about big guns. Yeah, i like big guns, and there is no need to have a compact one. I am not a Spy, Secret Police Officer, or rebel on WW II Europe, so if i carry i can, i would choose the one that packs enough punch, accuracy, and magazine capacity.
Note that here you can allowed to to carry a gun if you are politician, businessman, journalist or singer and such. If you are a civilian, its very rare to allow you just to possess a handgun, not to mention the possibility to allow you to carry it too...
That's why i am choosing a gun that will do its work. And that gun it would be big.
But if i was American, i would always keep a small gun in my boot.
Yes, they made wonderful backup guns.
As for home defense, you can always have a compact Colt or USP hidden somewhere for a time of need.