Tom,
A larger objective lens does provide more detail, everything else being equal. This is because in good optical systems, the major aberrations occur around the edges of the objective lens, mostly due to two factors: That's where it's "bent" most severely, and also bounces off the tube. This results in both fuzziness, and random light bouncing around inside the scope, which reduces contrast.
A larger objective has less edge per surface area than a smaller objective, so there's less light scattered, so the image is sharper. This effect is most obvious in dimmer light, but with really small objectives can be seen in bright light. An outfitter I once worked for was really thrilled when he was given a 10x20 Zeiss as a tip by a client. He was equally disappointed when I could see more detail through a 10x42 that cost a third as much. I handed it to him and he could too!
