How do I decide how large to build a kitchen island ?
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There are kitchen planning books available at Lowes and Home Depot to assist with this. If the kitchen is used by more than 1 person, 48" walkspace around all sides of the island reduces liklihood of "collisions", particularly if one of you has a container of boiling water or a knife in your hand.
I would figure out a few different sizes that you think may work and cut out the shapes with large paper and place it in the kitchen for a day or two. See if the paper is in the way or if it is the right size while you're walking around and working in the kitchen.