Maaaan, Roland and I have wildly different play styles/game enjoyment

. Playing without the backpack means lots of back and forth trips... Booooring

.
But I do agree that the backpack size is just right as is... Good balance between carrying loot, and having to go home to unload.
And then there's the minibike. After you get this, space is no longer an issue... At all...
Edit:
Just want to add this:
I see people arguing that the backpack should be bigger, so you can loot a whole town, without having to go home to unload.
Well a good trick is to create a storage chest in town, and unload the loot there. Then when your done looting, many items will stack, so it means less trips back and forth...