Hey OP,
Downstate alum here. Wow I should prob get used to saying that...
I'll offer my opinion despite my bias. And despite the fact that I know nothing about Hofstra. But seriously, I really do think Downstate is the better choice, and I'll try to explain why.
The basic point has been said already several times by posters with varying reputations, but I'll reiterate and go further, hopefully. It's not so much Downstate's reputation vs. Hofstra's non-reputation, or a renewed curriculum vs. a brand new mostly PBL-curriculum (btw did you know you'd be entering Downstate with a new curriculum? Don't ask me though, I don't know anything about it... I'm outta here), but above all else, it's a matter of education security. I would much rather go to an institution that has been in the business of training physicians for many years (151 as of my class' graduation), rather than one that's just sprouting. Unfortunately, the 'don't practice on me' attitude that a lot of people have towards residents applies here too, except here you're the patient. I would be very uncomfortable putting my medical education - the foundation for my career - in the hands of noobs. Sorry, n00bs. Now I'm sure that individual faculty will have varying degrees of experience teaching X, Y, or Z at other schools (probably extensive in some cases), but this will be their first time working together to synthesize an entire medical curriculum. There is no guarantee that your education will be as good as it should be or as good as it can be, or even that it will be up to par, period. And we won't know for two years until the first class takes Step 1. This, to me, is the most obvious reason their class is only 40. Because they might not know what they're doing in the beginning, and don't want to stretch themselves too thin with too many students.
I just applied for residencies. Going to a university and being in an academic setting with opportunities to become involved in a medical school is very important to me, and was a major inquiry of mine on the residency interview trail. As far as NS/LIJ, Hofstra was a big big big selling point my departments program used, and it was for others too, according to friends of mine. I wasn't buying it though... I'm just not comfortable being the guinea pig. I'd rather go somewhere with a well-established role, reputation and personality that I fit in to, rather than be the one all that is built around. Or on top of.
Lastly, scholarships are EXTREMELY few and far between at the level of medical education, at least in my experience, and are therefore nearly impossible to get. That being the case, you are either the valedictorian of Yale, or a guy from the NYC/Long Island area who Hofstra thinks they can entice with a wad of cash. Whatever you decide, for your own sake, please don't let that be the deciding factor, especially if the end result is equal tuition.