"Profile" is the hight of sidewall (vs the wheel itself), not to be confused with wheel size. 225/50/17 actually have a lower profile than stock 205/55/16.
The hole assembly has to remain about the same size, so wheel gap filling is rather a perception than reality.
"Lower profile" means bigger wheels to achieve the total size, "higher profile" need smaller wheels to do the same.
Lower profile gives a more direct connection with the road (sportier road manners but firmer ride) and, yes, bigger wheels could mean heavier wheel, thus, contrary to popular belief, less performance/mpg.
Higher profile gives a less direct connection with the road (more casual road manners but more comfy ride).
For instance, EPA ratings for LE Eco (15") is 34 mpg VS 33 mpg for LE Eco (16") and 32 mpg for S (17").
Not necessarily a big deal, but a choice of tires/wheels combination is always a compromise.