"He is small, and I am big."

Translation: El este mic, iar eu sunt mare.

[LukeMadhan]

When does one use şi verses iar?

[wyqtor]

They are interchangeable for the most part (at least, that's how I use them in daily conversation) when used to link sentences together, although 'iar' might be better suited for phrases like the one here, which imply some sort of contrast between two things. But, be careful, 'iar' is only used to link sentences!

[nickbii]

Why doesn't "Este mic, și sunt mare." work?

[sebastianmolin]

It sounds rather unnatural.
Always try to add pronouns if we're talking about 2 or more people :-)