Kurt is not any woman's visual first choice. He has pretty blue eyes, but he's pudgy, he has rosacea and he's clearly uneasy around women. But he lives off the money he earned rather than waste his grandfather's wealth on balldos, swinger vacations with pregnant hookers, and drugs. That alone makes him a far better romantic prospect. He also attended a much better law school than Nick, which by Nick's own metric, makes him a better man.
But it's not his moral rectitude Nick is attacking. Nick's oh-so-hilarious micropeen counter is supposed to humiliate Kurt but it just shows what a Scandinavian prude Nick is himself because if a phallus or phallus-like shape isn't being pounded in and out of a suffering woman, Nick is at a loss. Never forget that men with small dicks also have hands, mouths, and the ability to order sex toys that won't leave their partner bleeding all over the bed. One senses that Kurt has never once had to shove his balls into a plastic cage to fuck another man's whore of a wife because there's no way he can get hard enough on his own to penetrate normally. And if Kurt does have a micropeen, the fact remains that a hard micropeen beats a perma-flacid Polish shlong. A small dick is only a problem if you are an unimaginative loser fucking women whose vaginal canals are wider than an HOV lane.
Nick can mock Kurt's dick all he wants but we all know who the better man is.