Man I'm glad I went with the smaller size! It does work very well with liquid foundation, and it fits well into the nooks and crannies around my nose, however since it doesn't cover much surface area, I actually prefer to use it for blush application.
The smaller size works incredibly well on my cheeks and very lightly applying heavily pigment blushes. I have not tried it with a highlighter, but I'm sure it'll work wonderfully!
The verdict? Yes and no. Yes for someone who tends to gravitate towards heavily pigmented blushes, and no for someone who wants it to solely apply foundation, in which case I would recommend going with the 187 :)