I hope this is still an active email address for you. If so, I need some advice.
We have a bald faced hornet making a nest on the inside of our bathroom window. There is a screen protecting us from them coming inside, but I want to know if I should destroy it right away, or wait till it’s bigger (possibly containing larvae). I want to get rid of the hornets building it and prevent them from rebuilding under our soffits, etc.
Right now the nest is about three inches in diameter,  it just appeared two days ago and growing daily. It’s actually been interesting watching the hornets building the paper nest.
And advice?

In most cases, there is no reason to allow a nest like this to continue. There will only be more and more hornets over time and with the increase in colony size an ever increasing chance of someone getting stung. I suggest you take care of it ASAP and be done with it for the season.

If you read our WASP CONTROL ARTICLE, you'll see we mostly recommend the DRIONE DUST when treating nests directly. And when nests are built on windows, the Drione is usually the way to go. But your situation sounds different. Being the nest is built on the window screen, you may be able to directly treat it from inside the home with the screen being able to serve as protection between you and the hornets. If this is true, injecting them from inside the house may be the way to go. I've done this a few times using an serosol known as BAYGON. It's fast acting and comes with a thin injecting tube you can use to distribute the aerosol through the screen directly into the nest. This will provide instant control and shut down the nest in minutes.

In the times I've been able to use this approach, I was able to treat without the need to wear any protective equipment since the hornets couldn't access me through the screening. They did attempt to sting me but could not reach. A good soaking of the nest killed all occupants in less than a minute and within a day, all workers and scouts returned and died. If you can treat the same way, you'll be able to remove it within a couple of days and not have to worry about it for the summer.

Here are direct links to the information and products mentioned above:

Wasp Control Article: http://www.wasps.net/wasp-and-hornet-control

Drione Dust:  http://www.bugspray.com/catalog/products/page31.html

Baygon Aerosol:  http://www.bugspray.com/item/invader_hpx.html

The following is a complete "how to treat a hornet nest" video which will show in great detail what the nest looks like from the outside as well as the inside. And it will show these perspectives both before and after being treated. I say before because we were lucky to find a nest being constructed on a window which allowed us to get some great footage of what really happens deep inside the colony when viewed from inside the house. This unique view allows us to see workers, eggs, larvae and pupae as they exist in any common hornet nest.