Essentially, so long as you're the one doing the killing and it's a fair fight (no barriers, don't be a coward!) then you're good to go. I haven't heard any rules about size restrictions but I can promise you this (other staff can correct me on this): if you don't own the land and you make a giant 100x100 fightcube underground, don't come crying to the staff is somebody mines into it and decides to start using it too, or decides to use if for something else! Larger fight rooms, while a more exciting experience, take up a lot of real estate, and we need to share the land. We of course would deal with this on a case by case basis; on the same topic, don't take over somebody's legit fight room saying that you heard from me that it's okay.
There is one other possible size restriction: we've had problems in the past with giant darkroom towers being built near cities, on chunks that usually stay loaded, and the load on the server was madness. These were exceptionally large towers, with dozens of dark floors for generating mobs. We have a sweet rig and fat internet pipes, but Minecraft code can only handle so much and if a tower drops our tick rate down to unplayable levels it's going to get nuked, no question.
