The mixin count causes a nearly-linear increase in transaction size (slightly less than linear because of fixed per-transaciton overhead). But the transaction size is a function of the number of inputs, not the number of coins. If you receive 10000 and then send 10000 that is going be the same size transaction for any given mixin count as it would be to receive 1 coin and then send 1 coin with the same mixin count.
I usually use a mixin count of 3-5, or perhaps 10 on transactions that I know are very small (in terms of transaction size, not coins). Even using 1 isn't too bad (i.e. much better than 0) because as the coins go through a series of mix=1 transactions they still eventually become mixed with everything and very hard to trace more than a few hops. I'll sometimes use 1 instead of 0 on large (again meaning large number of inputs) transactions.
Thanks, this clears a lot up. So would it be a decent practice to periodically send all mined coins (multiple small tx's to one address) as one lump to another wallet I control with a low mixin count, rather than let them pile up and then use them continuously for future small scale transactions .. in order to decrease the size of the tx at that time? Or would this have no real effect on traceability/tx size? IE: Apart from the fixed tx overhead, is the size of the tx dependent on the just the origin, or more than just the previous origin?
It is definitely a good idea to combine small outputs into larger ones, otherwise it is impossible to ever make payments in larger amounts (the transactions will be too big). Now if you
only ever make small payments then I guess keeping the original small outputs is fine. But for larger payments they won't work at all, or will be too large to allow mixing. As far as mixin count to use when doing that, I can't give a good answer, as I haven't looked at the issues that carefully. The tradeoff is how many of these small outputs you can combine in one go. If you can't combine enough, you may need to do multiple steps.
The size of each transaction is dependent only on its immediate sources, not prior transactions that fed into those. So if you have a zillion tiny outputs and combine them into a few larger ones, subsequent transactions are not affected at all by the previous tiny outputs, and will be quite small.
