All my material, that isn't wood, is 1 1/2" x 1 1/2". I find a 24mm knot to be perfect for this size material, but I have fit as big as a 28mm knot in the same size stuff. Stefan (Mainaman) and Davids (Scarface) both had 28mm knots.
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You have to keep the top profile slender, and then sometimes you can cheat, and wrap the design around the outside of the cup and go slightly under it. I did this slightly on Stefans brush. The key is not cutting through the outside and into the inside knot pocket/cup. I've done it before and cursed my way into hell. I was pretty pissed off that I got out of focus and did it. It was a piece of expensive wood that I got a bit too zoned out and actually sanded right through until the top completely popped off.
To answer your question, yes. Bigger knots can be used, but it depends ultimately on the design of the handle.
Also, I'm finding that Tru stone is getting harder and harder to find. I've bought up a few different blocks but there usually is a lot to choose from. I know you can order it from Masecraft, I've never ordered from there and have heard they have a minimum order quantity which I'm not sure I like. Don't quote me on that, I need to look into their Tru stone again.