Selection on the level of loosely associated groups has been suggested as a route towards the evolution of cooperation between individuals and the subsequent formation of higher-level biological entities. Such group selection explanations remain problematic, however, due to the narrow range of parameters under which they can overturn within-group selection that favours selfish behaviour. In principle, individual selection could act on such parameters so as to strengthen the force of between-group selection and hence increase cooperation and individual fitness, as illustrated in our previous work. However, such a process cannot operate in parameter regions where group selection effects are totally absent, since there would be no selective gradient to follow. One key parameter, which when increased often rapidly causes group selection effects to tend to zero, is initial group size, for when groups are formed randomly then even moderately sized groups lack significant variance in their composition. However, the consequent restriction of any group selection effect to small sized groups is derived from models that assume selfish types will competitively exclude their more cooperative counterparts at within-group equilibrium. In such cases, diversity in the migrant pool can tend to zero and accordingly variance in group composition cannot be generated. In contrast, we show that if within-group dynamics lead to a stable coexistence of selfish and cooperative types, then the range of group sizes showing some effect of group selection is much larger