Internal Frame Packs:
- The only choice for snowshoeing and ski trips, off-trail scrambling,
  because of less shifting and more control.
- Easier to stow in a car or airplane.
- Some now using tensioned mesh or channel to create a cooling air space

External frame packs:
- Cooler because of airflow between frame and your back.
- Great for hauling big, heavy and/or awkward loads.
- Cheaper.

• Front panel access so you don't have to take everything out from the top to reach something at the bottom.
• Adjustable suspension (shoulder harness adjustments)
• Ventilation system to keep back dry (mesh or foam channels)
• Lumbar pad to transfer loads to hips
• External pockets
• Sleeping bag compartment
• Pocket on waist belt
• Hydration pack sleeve
• Compression straps so load doesn't shift when pack is not full.
• Gear loops (for snow shovel, crampon, sleeping pad, ...)
• Attachment for skis and/or snowboard (e.g. straps at the top and pass-thru holes in side pocket or bottom loops)

Pack Bag Volume

Length of Trip	External Frame (cu inches and Liters)	Internal Frame
2-4 Days	1,500+ cubic in (25+ Liters)	3,500-4,500 cubic in (57+ L)
5-7 Days	2,000+ cubic in (33+ Liters)	4,500-6,000 cubic in (73+ L)
8-10 Days	3,000+ cubic in (39+ Liters)	5,500+ cubic in (90+ L)

Source: http://www.princeton.edu/~oa/ft/equipment.pdf

My old (late 60's) external frame pack is 2,600 in³ in two main compartments.
Plus 650 in³ in 5 external pockets.

External frame packs can be smaller than internal frame packs because there are spaces outside the packbag to strap large items directly to the frame.

• Under 2,000 cubic inches: Small packs for day trips like hiking and ski touring. They have no frame, a thin belt, and possibly a chest strap, and vary in the number of pockets and other features.
• 2,000 to 3,500 cubic inches: Stream-lined packs for gear-intensive day trips like climbing and winter hiking. Most have a thin foam back pad, and straps to draw the pack against your hips (stabilizer straps) and upper back (load-lifters). The design is generally minimalist to reduce weight and bulk.
• 3,500 to 4,500 cubic inches: For light packers on warm-weather weekend trips. If your gear is bulky, get a pack closer to 4,500 cubic inches for weekend trips.
• 4,500 to 6,000 cubic inches: Large enough for treks of up to a week, year-round. These popular packs vary greatly in design, features, and fit.

The Complete Walker IV has a formula for computing the correct size which is available at Backpacking-guide.com
It makes a big difference if you go alone or with a group and how warm you sleep. For example: Spring or Fall 3 day trip, 150 lb hiker:

Cold sensitivity	Number
	Solo	2	3	≥4
warm	2805	1870	1309	1122
normal	4208	2805	1964	1683
cold	5611	3741	2618	2244
winter trip normal	6734	4489	3142	2603
6 day trip spring - normal	5952	3968	2777	2380

The Complete Walker formula doesn't distinguish between internal or external frame packs, but since internal frame is preferred now I would guess it assumes all gear will fit inside.

Torso Length:
According to Wayne Gregory, your correct frame size can be found by measuring your torso from the seventh vertebra down the spine to the point in the small of your back which is horizontally level with the top of your hip bones. To find this point, use your fingers to trace the hip bone upwards till you feel the point where the top edge of your hip bones curve inwards, on the side of the hip, creating something of a shelf. This measurement is the torso length, especially useful to consider those packs with non-adjustable back system. In fact this system that is used throughout the outdoor industry today to measure the exact body size and to determine the correct frame's size.
HikingHelp.com/blog
 
Source: rootball at WhiteBlaze.net/forum/
Measuring torso length at REI

Small - 16 - 18 in
Medium - 17 1/2 - 20 in
Large - 19 - 22 in

Items to consider in selecting an internal frame pack:

Source: outdoorsMalaysia.blogspot.com

Manufacturers:
Gregory Packs
Northface
JanSport
Kelty
Osprey
Lowe
REI
Granite Gear

Stores:
BackCountry
REI
Sierra Trading Post
Campmor

Links:
How to Choose a Backpack at REI
Hiking Backpacks - Making The Right Choice at Backpacking-guide.com
Find the right pack at AMC
http://www.princeton.edu/~oa/ft/equipment.pdf
Buying a Backpack: Fitting Solutions for Every Frame at AMC
How to Adjust a Backpack | eHow.com
BackpackGearTest.org - Packs