Is it better to have a very small(12-21 month) gap between babies,a larger gap(4+ years) or somewhere in between?

This is a choice that each parent must make for themselves.  They must consider THEIR life goals and what they imagine their family to be.

Next, they should consider what is medically healthy.  Most doctors will recommend waiting AT LEAST one year before trying to become pregnant again and many doctors recommend as much as two years before trying to become pregnant again.  That would place a two to three year gap between children just based on what is medically recommended.

Some parents think that having children closer together will make the children "close".  This is NOT always true.  Each child is an individual person and just because of that, they may not always get along because they might end up with very different interests.  (one could end up being great at sports while the other one becomes more of  a comic book nerd).

Some parents will space their children a little farther apart to avoid things like having two babies in diapers at the same time.  (after all, if your second baby is born before your first baby reaches the age of two, it is very likely that you would still be dealing with diaper changes and possibly other issues with the first baby while trying to care for a newborn)  So, then you would be working on potty training the first child while caring for the newborn.

At different stages in the children's lives, there will always be points in which the older child is ready for something that the younger child can't do yet.  Parents will always need to make a plan on how to deal with telling a younger child "no - you can't do that yet - you are too young" even if the age gap is small.  (after all, a child who is ten years old and going to a friend's birthday party should not be forced to take their eight year old sibling with them)

There really is not a "best" or "better" age gap between siblings.  I do believe that extremely large age gaps should be avoided.  Anything more than about six years is probably too much.   If you are having several children, you might end up with a six year gap or more between the first child and the last child and that would be expected in a family with several children.  But, between any two children, anything more than six years is a little too long.  I am twelve years younger than my next sibling.  We basically share very little in common and we have always been at such a different stage in our lives that there was never really any common or shared life events to keep us together.  For my children, my goal was a three year age gap.  I wanted to avoid having two children in diapers at the same time if possible.  Due to a few unplanned issues, the age gap ended up being a little over 4 years difference.  My daughters have had points in which they would be real close and other points in which they would fight all the time.  (when older one hit teens and younger one was still elementary age was the worst time frame)  But they are both adults now and they are very close.  

2.5 years is the average age gap.  How do i know that?  Every person in my class with an older or younger sibling from high school was 2 years apart...all of them

It's recommended (medically) to wait about 18 months before getting pregnant again so the mother's body has time to fully recover. The "gap" shouldn't ever be about what's best for the children but for the one who is bearing them.  

Better for who?  The children prefer closer ages with siblings.  They are close enough to grow up together.  Parents tend to like to avoid having multiple children in the same intense periods of life (like toddlers or teens) so are probably better served by larger gaps.  Heck, I hardly know my oldest (10 year difference about) siblings.  they were out of the house before I ever really got to know them.; in high school when I was in kindergarten.