You can't fold the bike with the bag in situ, but you can put the bag back on its block once the bike is folded. I also like the fact that, as already mentioned, you can leave the bag in place with the rear wheel flipped under, which you can't do with panniers on a rear rack.
I bought an S bag because it was either that or the pannier at the time I bought it. I didn't know about the C bag (is it new?) or I might have got one of those. But I love the S bag and all its pockets - it fulfils the role of a briefcase for me. It's smaller than the C bag but still a useful size. And it seems reasonably water-resistant to me - I've only had a problem with water penetration in prolonged heavy rain.
Only thing I don't like is that it's not idiot proof...
The mobile phone pocket on the side is actually too small for my mobile phone. I once put my keys in it after unlocking the bike outside Tescos and by the time I got home, I'd forgotten they were there so thought I'd lost them en route. I shook the bag to see if I could hear them rattling but the pocket is so tight that there was no noise. Ended up having to ruin my lock to remove it from the frame. Eventually rediscovered the keys about six months later.
d.