Bond (at lest the cinematic one) is a fictional, and not particularly realistic spy, so there really isn't any reason for his choice of firearm to be particularly realistic or practical. The PPK is as much a part of the James Bond character as his expensive wristwatch, exotic cars, or way with women. As such, I see no reason to change it as most of the fans aren't watching the films to see a realistic representation of espionage, but rather for escapism and nostalgia (I say this as a very big fan of Bond films and novels).
If we were trying to make Bond as realistic a spy as possible, then I'd think his choice of weapons would be dependent upon the mission. For example, if Bond were going undercover as a Red Army officer, then something like a TT-33 Tokarev or Makarov PM (depending on the time period) would be most appropriate. For some missions, it might be better for Bond to be unarmed as the risk of a blown cover due to being caught with a weapon would be much greater than the chances of needing to defend one's self with said weapon.
As I said, the cinematic Bond isn't a particularly realistic spy, but the literary one (at least in Fleming's early novels) was a bit more realistic (though realism was still usually secondary to a fun and exciting plot). While Fleming was known not to be particularly knowledgeable about firearms (his Bond novels often demonstrate this) he wasn't completely ignorant to them and consulted with people like Geoffrey Boothroyd in an attempt to get the basics right. Choosing small-caliber, concealable handguns over larger, more powerful ones was an absolutely realistic choice particularly in the 1950's and 1960's when the original novels were written.
Fleming originally chose the Beretta .25 (the model is never specified in the novels but we assume it's a 418) as it was similar to the Colt .25 Auto he'd been issued from SOE during WWII. Boothroyd, being a "gun guy" took issue with the choice of a .25 and wrote to Fleming initially suggesting a S&W Centennial Airweight .38 Special. Fleming responded thanking Boothroyd for his comment and stating that he'd prefer to arm Bond with a semi-automatic partly so that it could be fitted with a "silencer." The PPK was Boothroyd's second suggestion.
Also, in the novels, Bond quite often does opt for a larger, more powerful firearm when concealment is less critical to the mission. In Dr. No, the novel in which Bond is forced to give up his Beretta, he is issued not only the Walther PPK but also the S&W Centennial Airweight as a "heavy weapon" (like I said, Fleming wasn't a gun expert) and uses the S&W throughout the latter part of the novel on Crab Key. Also, Bond frequently uses a "Colt Army .45" such as in Moonraker and A View to a Kill. Bond also frequently requisitions long guns for various missions such as the Winchester .308 "target rifle" he uses in The Living Daylights (changed to a Walther WA2000 in the film) or the Savage Model 99 he uses in For Your Eyes Only.