Yes, a 17" LCD will have a clearer picture, look better at 1024x768, and have near the same viewable size as a 19" CRT. Although I personally bought a 19" LCD, I would probably recommend a 17" one for gaming.
It all has to do with the facts the the pixels are physical rather than projected with a CRT. To get a real small pixel pitch in a 19", you would more than likely have to get one with a 1600x1200 native resolution rather than 1280x1024.