The canopy wants to trap the rising smoke/vapor/greaseparticles, which we call "effluent" for short, and the effluent column expands as it rises. What that means is that as you increase the vertical gap between the stovetop and canopy, you need a wider and deeper canopy to get the same amount of effluent capture. You may also need a little more cfm. If not, as Momto says, some of the effluent escapes. How worried you are about that will depend partly on your cooking. If you do a lot of wok cooking and meat-searing, I'd be more worried about effluent capture. Also how close the kitchen is to the rest of the house, how sensitive people are to odors, how often you want to wash your walls etc. A lot of folks go for 30" or less vertical distance to get good capture, and say that they soon learn not to bump their heads. I went for a canopy just above my 6' height, but with 12" overlap on either side of the cooktop and a 9-inch bump-out from the wall. You will find *lots* of discussions of hood height if you search the appliances forum, as well as cfm and other issues. For example, makeup air is essential if you are venting a 60" Wolf, and will have a lot to do with how effective your ventilation is. This is new to a lot of people...

A standard duplex cover is 3" so if you want to squeeze, you could do a 3" filler, however, its always been my experience to leave a little extra, so maybe a 4" filler.

I have 6" of space between the widest part of my hood and the cabinet on either side of it. I didn't give much thought to how many inches would be best. I just knew I wanted some space between the cabinet and the hood. In retrospect I wish I had just done 4" because then I could have made the two narrow cabinets on each side 2" wider. I think 4 inches of space would have been fine. Some people will say that you need more space or the sides of your cabinets might get some grease on them. My kitchen is almost 5 years old now and there has not been one bit of grease ever on the cabinets by the hood. Here's how 6" of space looks with my hood. And here is a link to previous discussions about spacing between cabinets and hoods. Space next to hood

Proportion is very key to any space. It depends on the kitchen layout, the hood design/style, the cabinets around it, if any, the ceiling height, etc. IMPO, I don't see anything wrong with the space around your hood in the drawing posted. It is giving you 3" on each side to the cabinetry. PS.... This is in assumption that you are going with the chimney style.