I see this assertion a lot, but I have never actually seen a system in which inlining that would otherwise be a win in terms of performance becomes a loss in a large system. LLVM developers seem to agree, because LLVM is quite aggressive in inlining (the joke is that LLVM's inlining heuristic is "yes").
I'd be curious to see any examples of I$ effects from the effects of inlining specifically in large systems mattering in practice.