The displacer is like a float. Actually, what I was referring to looks more like a float than a displacer. It will be attached to a controller and the black fat part will work like a float in a toilet does. As the fluid, be it oil or water, rises it will work the controller and cause the dump valve to open and close when the fluid is high enough in the vessel to dump and close the valve when it has dumped enough. A displacer actually hangs down and sits in between the water and oil. It senses the difference in the density of the fluid and works the same way. As far as the size goes, I am not 100% positive about. My educated guess would be because of the heaver oil, i.e. 30API gravity or less, but again, I am not sure why you would use a larger one. Hope this helps.