1) I had no reason to go for the 3G model; I always have my iPhone with me and can't be bothered carrying the iPad around anyway. You might, but keep in mind that it is quite a bit dearer by the time you add in the cost of a data plan.

2) If you intend on having movies and other videos on there, a 32gb or 64gb version can be justified. Good quality vids are still pretty big in iPad format so by the time you add a few gigs of music, a few gigs of apps, there's not all that much room left for videos. You can encode movies down to 500mb or so without dramatically affecting the quality so you can have quite a few videos on there but you may find yourself having to swap stuff over more often. Also, the useable capacity of the iPad 16gb is around 14gb so you lose a couple of gigs there.

3) You should find free Wi-Fi pretty easily in Europe (Mcdonalds, Starbucks, some hotels etc) so it's not a must if you just want to keep in touch with Oz while you're over there. If you want Internet access on the move, you can roam on European networks using your Australian 3G data plan but that would cost an arm and a leg unless you have some sort of roaming data pack. For those purposes, it's probably better to go with a global network like Vodafone. If I were you, I'd be checking roaming prices along with the cost of prepaid European data plans.

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