I use this on Windows. For a large hosts file (several megabytes), I find the DNS client service hangs until it reads the whole file. Further, there is also a noticeable delay in the order of a few seconds until the hostname is resolved. For smaller files, I find there is no noticeable lag. Can't offer you any numbers though.

Hostsman (http://www.abelhadigital.com/hostsman) on windows is the my choice of a frontend for hosts management. It's free but not open source.