The phrase "assuming all the intervening variables to be the same" is the key to the question. Teacher, subject, duration, room and student ability are all held constant, so group size is the only variable left, and the answer must be whatever group size alone does to interactivity.

Interactivity is bounded by the teaching time available for exchange. If that time is fixed, a class of 10 gives each student roughly ten times the share of speaking opportunity that a class of 100 gives. So participation per student falls sharply as size rises.

Smaller groups also lower the psychological cost of speaking. In a class of 10 the teacher can recognise each student, notice a puzzled expression and invite a response; in a class of 100 individual feedback cues are lost in the mass, anonymity increases and hesitation to speak before a large audience rises. Communication in the large class drifts towards one-way transmission.

This is why the smaller the group, the closer classroom communication comes to interpersonal communication, and the larger it grows, the closer it comes to mass communication.

Hence interactivity of students with the teacher will be higher in Instance 1 than in Instance 2.