Load and therefore wear is spread over a greater number of teeth. Ever noticed that it is the smaller sprockets on a cassette that seem to wear out first?

With larger chainrings and sprockets there is less friction in the chain due to the smaller angle through which each chain link has to turn as it conforms to the sprocket. This makes using larger sprockets more efficient. I’ve no idea how much more efficient though, I’d bet you’d not be able to notice. Larger sprockets will last longer though, so that’s a good enough reason to use them.

I’ve done the same with an old RPM bottom bracket. I looked and couldn’t find bearings to fit (same size as you quote), but when I noted that the nearest size were at least £4 each (http://simplybearings.co.uk/shop/product_info.php?products_id=6214) it doesn’t seem worth it when I can get a whole BB for less:

http://www.chainreactioncycles.com/Models.aspx?PartnerID=79&ModelID=22376

A dynamo is pretty much a constant current device, so get rid of the drivers and just run the LED’s directly from the rectified output. Works beautifully, apart from a little flicker at low speeds.
Maybe this site will help:
http://www.pilom.com/BicycleElectronics/DynamoCircuits.htm

Stabilizers, my email address is in my profile, or let me know how to contact you. Thanks!

Stabilizers
If matt_outandabout doesnt want it, I'll take it. Just right for me.

ZTR, America classic, WTB and A2Z hubs are all apparently made in the same factory (Chin Haur, or something) and are all very similar in design.
I have some WTB ones. Lightweight but the seals aren’t brilliant and the bearings are a little difficult to get hold of (Ison distribution are currently out of stock, but simplybearings have them at three times the price).

My helpful hint for the day is that the A2Z ones are even cheaper….

For cheapskates….
One old Alivio derailleur, a bolt, some penny washers and assorted other aluminium spacers (washers would do). Remove cage, add spacers, flip upside down, et voila, one chain retention device.
Take a hacksaw and file to it to remove redundant lumps and it even looks quite slick (from a distance, with mud in your eyes).

Sizes like that are really weird in the real world of bearings. They are most likely for bicycle hubs only and nothing else. As you say ID is probably your best bet.
See here:
http://www.billys.co.uk/english/group.php?prod=bg-sealed