I forgot to mention that a couple of proposals stated that we do not need to retrofit the existing duck work since the HVAC will be a 2-stage unit.

While the duct modifications add to the total cost, they are necessary. 18" round supply and return would be ideal. 16" round HARD pipe would be minimal for a 3 ton. Flex duct adds some resistance, and it usually isn't run very straight which inhibits flow even further. I'm assuming the ductwork is flexible, which is fine. But it needs to be installed properly and sized correctly. The ductwork should be sized for high stage. Low stage capacity will be around 75% of high, give or take depending on the particular unit you go with. So on low stage, the system will still want to move 900-1000 cfm. This isn't "too little" for 18" ducts. The system will run quieter and more efficiently with properly sized ductwork. Some of the newer variable capacity units have a much larger range of airflows depending on demand. Hope this answers some of your questions.

ryanhughes, thank you for your help. In your opinion, on low stage, the 18" duct is properly sized for the 3T 2-stage gas pack. Do you recommend going with the new duct design where the main 18" duct is splitted into 14" and 12" branches? Again I'm concerned that these two combined ducts are oversized for the 3T gas pack operating on low stage. I'm more comfortable with the new design operating with a single stage gas pack.

In my opinion, the 18" flex duct for supply/return is properly sized for a 3 ton gas-pack system period, 2-stage or not. Again, it is not proper to size the ductwork based on low stage.

I checked the fan performance table on the 3 ton XL16c. At 400 cfm/ton, on high stage it will move approx. 1200 cfm and on low a bit less than 850 cfm. Heating airflow is a bit different but in the same ballpark. I assume they quoted the model with 75k heat input. I strongly doubt you require the 96k model.

I'm not sure I'm clean on the duct system setup. So you'll have 18" flex coming off the packaged unit, supplying one primary distribution box which branches off to two other boxes with 12" and 14" flex ducts? I'd rather see properly sized metal, rectangular (matching unit openings and transitioning as/if required) supply and return trunks coming off the unit with appropriately sized branch runs rather than flex duct everywhere, but what you describe is not all that uncommon. I don't see an issue with the 12" and 14" flex duct from a size perspective on either high or low stage. There is no "maximum" or "minimum" airflow a duct can handle, but with 1200 cfm or less, assuming the ducts aren't badly kinked, the static pressure and friction should be within reason.

Are you certain they did a Manual J load calculation? Have you seen the results? I question a 210 sqft addition adding half a ton to the cooling load, unless it's all glass. Many homes have systems that are already oversized. So 2.5 ton may not be "undersized" even with the addition, but a load calc will tell for sure. Of course, 2-stage systems come in full-ton sizes, but proper sizing of 2-stage systems is still critical. An oversized 2-stage system will spend just about all of its time in low stage, acting as an expensive single stage system.

I wish I could type more but have to leave. Hope this helps and doesn't add more confusion.

ryanhughes, again thank you for your help. Black flex ducts everywhere are what I see in the crawl space! I'll try to ask the contractor about the metal rectangular supply and return trunks as part of the new duct design. I did not see the Manual J load calculation, but I was told that the first floor is 1900 sqft, the second supply cube covers about 600 sqft. All the contractor claimed that the first floor needs more than 2.5 T but the builder rounded downn to 2.5T to keep the cost down. They also say that most of the time, the unit operates on low stage and only ramps up to high stage in extreme temperature days. Therefore, I wonder whether I should get a single stage unit like the current system.