As for which is better, it's really a judgement call. Personally, I still like the model on the left because both the root-mean-square and average standard error are lower than the model on the right. A large difference between the RMS and the average standard error can indicate model problems, but a root-mean-square standardized of .85 indicates that the problem is not severe in this case. And the one point on the x-axis of the LPI model is also concerning.
When we change the graphic, we'll find an example where a lower RMS clearly does not imply a better model.