Lissa- I just had a Franke Little Butler installed three days ago and I can't tell you how much we love it. The reason I chose it was that I wanted both the hot and cold water to be filtered, and at the time I was looking, Franke was the only company that did this that I found. (I bought the unit last year, yes it has taken THAT LONG to get to where we were ready to install it). The Insta-hot brand filtered the cold but not the hot water. Anyway, the unit is not that big-- the heater is a rectangular cube about 11x7 inches. The filter (it is a Franke triflow filtration unit) is a cylinder about 11 inches high by 2 inches in diameter. However, I don't have a separate cooling unit for the cold water, since the temp coming out of the cold tap is good enuf for me. Also, my fridge has filtered cold water for those times when it matters to me. But the Little Butler filter, heater, and my garburetor fit very comfortably in the sink cab, which is 36" wide. As for cost, when I was looking these units were quite high, but I bought mine from an ebay storefront with 100% positive feedback for about half the price I was quoted in the snazzy plumbing showroom (can't remember numbers now, it's been so long). Hope this info is of use, good luck!

"......does it make any sense to ALSO have a dedicated filtered cold water tap at my bar/coffee station sink?" If your tap water tastes like mine, it certainly does! Believe you're talking about two issues 1) scale/deposition and 2) taste. Scale/deposition can be handled via water softening. Taste can be handled via filtering -- typically via activated charcoal stack. Taste is a very individual thing. How far you should go is up to you. In my case, local city water is 7-10 grains hard; about 200ppm TDS; and tastes distinctly alkaline, which is a region-wide characteristic. It leaves scale on heating elements and bad tastes in coffee, tea, rice, pasta,.... just about everything. I have a softener delivering zero grains to everything. Also have RO unit with sink spigot delivering water at 2ppm TDS which is also piped to the ref. ice-maker. Anything consumable in my household that is prepared using water gets it from the RO spigot. Many people do not like the taste of soft water or RO water and have their personal favorites among the bottled waters. In any event, you should start out by knowing what's in your water now. Have you had it tested? Interestingly, although you talked about filtration and all your various concerns, you said nothing at all about whether or not your water tastes good/bad/neutral. Nor did you say whether or not you've had trouble with it previously.

It really depends on what you are trying to filter from the water, and whether another faucet is really an issue. If you are looking to remove everything from the water, I would suggest a reverse osmosis system. If it is only chlorine and the taste of the water you are concerned about, then the above water filters will do the job. Here is a link that might be useful: Aquasafe Systems

Most places have great water. Some places don't. And that's hopefully something you know about if you live there. It could be organic contaminants (e.g. pesticides, drugs, solvents, ...), it could be minerals (e.g. hard water, "dirty" iron deposits, ...), it could be other industrial inorganic contaminants (e.g. heavy metals, nitrates, ...), it could be biological contaminants (e.g. viruses, bacteria, ...), it could be radon gas, or it could be harmless nuisance impurities (e.g. chlorine smell, sand, ...). Some of these are more likely in municipal water supplies, others are more common in local wells. If you know what you are concerned about, then you can look for the appropriate type of filter. Quite frequently, a big activated-charcoal cartridge takes care of things. And that's the most commonly sold filter you'd get. But for other types of contaminants, charcoal is going to do zilch. Also, it really depends on whether this is just a nuisance contaminant or whether there are real health risks associated with it. If in doubt, have the water tested by a lab. The supply in your house might very well have different water than the one your neighbor has, because internal piping materials differ.