Turns out I was wrong - the SD900 does have a larger sensor. It's got a 7.18mm x 5.32 mm sensor (1/1.8) versus the 5.76mm x 4.29mm (1/2.5) sensor in the SD800, SD600, SD630, etc. The SD550 also uses the larger sensor.
An extra 1.42mm of width doesn't sound like much, but it adds up to just over 50% more surface area (38.2mm vs 24.71mm), which goes a long way towards improving the amount of data it can capture and the ability to hold down noise.
Of course, this is still a tiny sensor for capturing 10mp of data. Steve's Digicams was very impressed by the image quality (though much as I like the site, the reviews are often a little "soft" on the camera) and the samples look decent, and someone doing a user review on DPReview found much better image quality going from the SD800 to SD900 (upgrading from an SD550, with the larger sensor). On the other hand, a few other user reviews complain of substandard image quality.
I would say, though, that I might have to retract my statement. All else being equal, IS beats more mp, but when it's IS versus a larger sensor (probably too large for them to easily IS in a body that small), the decision gets a lot more complicated. The IS is handy, but the larger sensor will mean sharper photos all the time, and the ability to bump up ISO to get a faster shutter speed, making IS not quite as important.