The cutouts style bench has a couple of purposes, and how deep it is
depends on where you learned, and what you intend to do.
European style benches have a fairly deep cutout, while Americans
either have no cutout at all, or a sort of token cutout that's
mostly there for looks. Of course, the American benches can have
drawers at the front of the workspace that there isn't really room
for with the Euro style.
What the cutout's for is to brace your shoulders on when engraving,
or doing delicate work. I'm going to go with the odds, and say that
you're right handed. If not, just reverse the handedness of
everything I'm about to say.
The reason for the deep cutout is to brace your left shoulder on. It
also lets you get your right arm up onto the tabletop, to get all
those big "throw rock at dinner" muscles in your shoulder out of the
game when you're doing delicate work like engraving.
The ultimate goal is to have the work in front of your face, at
about chin height, and maybe 6-8 inches in front. (Whatever's
convenient for the state of your eyes.) So, to answer your question,
the cutout should be the width of your shoulders, plus enough extra
to let you move your good arm easily while filing or sawing. Depth
should be enough to put the work in front of your face, plus 6-8
inches or so. Add in more if you plan on using a GRS plate and
Benchmate, because they have about 6" of depth themselves. Make sure
it's the right height as well. The work should be somewhere between
upper chest and chin, with your back straight, and your feet flat on
the floor. (while sitting in your favorite chair.)
I have pictures of me making an improv bench out of an old desk on my
website, here: http://www.ganoksin.com/gnkurl/1sk
The infamous old FrankenBench plans. The pictures there will do a
better job explaining quickly than I would going over it again here.
Hope that helped.