Need Tire Size Advice

Going to replace the wheels and tires on my 2008 S60 2.5T. I've never understood the tire selection Volvo used for this car. My dealer tells me I can go to a taller wheel and tire but not wider. So, I'm looking for suggestions as to go from a 16" to a 17" in terms how this would impact handling. And also would interested in thoughts on tire brands. Running Goodyears right now and have never liked them.

Any input would be appreciated.
 
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