In this case, only the wallet.dat needs to be in the TrueCrypt
Here
https://en.bitcoin.it/wiki/Securing_your_wallet#Windows it says ''Use the third-party disk image encryption program of your choice to create and mount an encrypted disk image of at least
5GB in size. This procedure stores the entire block chain database with the wallet.dat file so the required size of the encrypted disk image required may grow in the future.''
1. It is my understanding that the space required for wallet.dat file would be substantially smaller than 5GB, am I correct? What size would you recommend for wallet.dat only?
I tend not to have a lot of addresses in my wallet. In general it appears that mine is measured in kilobytes. As such I'd think 100 megabytes would be plenty for most people.
2. What space would you recommend for the whole of Bitcoin-Qt? Although I have been using the application for a few hours the data size is now 8GB (probably due to historical block chain data) - this would mean the info on the wiki is outdated?
Yes, and the blockchain continues to grow indefinetly. There is a lot of talk that it will start growing by about 1 megabyte every 10 minutes pretty soon. That would work out to somewhere around 52 Gigabytes per year.