Hi Adam and welcome to IIS!!!
As I am fairly recently of Newbie status myself, I can give you a bit of help. The Celestron 120 XLT I believe is a refractor on a EQ mount with an aperture of 120mm which is fairly small. Generally small aperture scopes are most useful for bright objects, moon, planets brighter Open clusters etc. Also refractors tend to be more expensive than reflectors as they are harder to make.
My first scope was a 130mm Newtonion on an EQ mount which seemed like a great idea until I tried to use it! EQ mounts are hard to use and take some practice, and while it seems easy in daylight, the same operations when it is dark and cold are MUCH harder.
My next scope was a 12" GSO dobsonion which I picked up for around $1000 brand new. I picked this after having use of aclub loaner 8" dob for a few months and discovering the joy of Dobs!
I found more objects in one night with the 8" than I had found in 12 months with the EQ mount. Even getting the moon or planets was hard with the EQ, with a dob its just point and look.
You are correct in saying you don't need a 20" to find many of the objects you are interested in, but when you see the difference in view of Omega Cent or M42 in a 12" or even 8" scope compared to a 120mm refractor you will be blown away.
So based on my experience, and I have typed this same sentence on this forum many times now, GO GET AS BIG A DOB AS YOPU CAN AFFORD!!! you will not regret it.
If you are still not convinced, get yourself to a club observing night or star party and have a look at the scopes and through them. One thing you will notice, around 90% of the visual observers are using big dobs (by big I mean anything from 8" to 15" or bigger) with the remainder using GOTO cats. Small scopes on EQ mounts are rare among visual observers.
Malcolm