Lots of demos use streamed music and usually they are around the 5mb mark.
I think that's perfectly acceptable for size, but if you are going to use an mp3, don't just make an intro, make a good show for people to see that lasts a good few minutes with several scenes and plenty of effects.
If you are using tracker music, it is acceptable to release much smaller intros and cracktros, nobody seems to kick up much of a fuss about them.
Of course you won't get much criticism here amongst your friends but if you were to release into the scene and you want people to comment on what you've done rather than the file size then I think you're asking yourself some sensible questions.
I have seen typically, 200 - 500kb exe, 2mb - 7mb mp3 or wav, and then a shedload of gfx.
If your demo is substantial, why not add some streamed music.. In fact I even know of a streamed track by a musician friend of mine who wants it released (if the demo is of a high standard).
