I think you want the larger Weber charcoal grate that is closer to 16" for the base of your basket. The larger diameter will catch / burn the drippings better. My experience with cooking fatty beef ribs showed me the fat is converted to fuel by a UDS... crazy but true.
I built mine 12" tall but that is really more than you need.... and heavy! 8 or 10" tall will hold more than enough for 12 hour cooks. I got the flattened 12" x 60" x 3/4" x #9 expanded metal as a "scrap" from Ramcast metal for $20. (9165 Glenoaks Blvd., Sun Valley, CA 91352)
Mount it on a 18" flat pizza pan with 2 to 3 inch risers made of bolts or whatever. That way you can push the ash off the pizza pan into the trash without dumping the good leftover coals out of the basket.
I have not tried a diffuser or water pan... it is VERY moist in there when cooking and my family likes the flavor.