A unit of measurement must be defined before you begin construction on a 3D game. So what do you design this metric around? The potential chicken and egg of game design is to design around the avatar or the geography. Consider this from Richard Bartle's Designing Virtual Worlds:
"The religious view of the real world is that one or more deities created it. Normally, the deities put the world together before introducing humans into it (rather than creating both at once or the humans first). However, from the beginning, the deities intend to populate the world, and therefore design it with the humans who will live there in mind.
For the real world, you should decide for yourself which of these views is the more correct. For virtual worlds, discount the first one. Deities create virtual worlds; designers are those deities."
Linear Working Units
As far as my research has stretched, it's best practice to measure via the metric system and, for god sake, use meters not centimeters or decimeters.
That said, here's what I ended up with for MyMiniPeeps at the end of the day:
With this in tow, the sky is the limit! Now you can describe the geometry of interiors, stairwells, doorways, and etc! I definitely do not recommend starting any asset creation until you have decided on and COMMITTED to the bounds of your avatar.
[Note: As you see in my graph, I've left room for bulky accessories. My game requires loads of customization. Yours may as well so remember to plan for them.]
Other things to consider...
Does Size Matter?
How large should a virtual world be? My vote, it should be as large as it needs to be in order to be entertaining. If you build a giant map with nothing to do then you'll bore your audience. If you build a small map and don't shard, then you'll frustrate your audience (not to mention you'll overload your servers).
Speed's effect on Size
We must consider how fast our avatar's move in order to really comprehend how large our world will feel. Feel is different than the actuality of the geometry. Consider this passage also from Bartle:
"Speed of travel affects size: If it takes you half an hour to traverse one virtual world and two hours to traverse another, the former may appear to be smaller than the latter even if it isn't; if you can teleport anywhere, the world will feel smaller still."
This has been an exercise to investigate various ways of capturing a spacial definition. I hope you've enjoyed our journey. Seriously, if you take anything away from this blog make sure that it's this... Plan ahead when it comes to your unit of measurement and your avatar's bounds. You'll be happy that you did.