Replacing a shorter manuscript with a longer manuscript on arXiv
If the new manuscript version supersedes the old one, and includes all of its content, I would suggest replacing it. After all, if, say, PRL would have asked for Supplemental Material which would have added up to another 10 pages, you would also have updated the arxiv version.
An added advantage is that people don't get confused by the fact that there are two different versions of the same result on the arxiv, and they don't know which one to cite.  (You would also loose citations this way, except on google scholar, where you might gain some; this could of course be resolved by adding the Journal-Ref field for both of them.)
Finally, if you decide to post two different versions, it would be a good idea to add a corresponding comment field to both publications, informing the reader about their relation.