I built mine with the flue pipe extending into the cook chamber to just above the top cooking grate, about 5 inches. This seems to work out and I get good clean smoke, but I would be afraid to go any deeper than about the midpoint of the cook chamber; afraid you might get a lot of stale nasty smoke trapped in there. Just my $0.02.
Weber 26.75 OTG w/CI grates & SJ/WSM Mini
Home built 24"x72" reverse flow stick burner trailer with 18"x44" grill w/CI grates and upright SS gas oven/smoker.
Home built 48" fire pit with a 30"x30" Santa Maria style ranch grill.
Home built lump charcoal retort, iGrill & a bunch of other cooking toys.