This tutorial runs through the process of creating a grid from point data, for example, LIDAR data. The points are turned into a surface, and then the surface is gridded.
An important detail in this video is the selection of grid spacing. Grid spacing is a balance between getting enough detail, but not having too many points. There is no limit on the number of points in a grid, but larger grids will be slower to work with, and may be sluggish in the 3D window.
The rule we advise is to take the dam crest width, divide it by 2, and that's the maximum grid spacing to use.
We would also advise that a practical upper limit for the number of points in a grid is 1 million.