I don't think they should be more than 1/3 of the mirror's length. Hang the mirror just 3-5" above the wainscot and cut out paper shapes of the styles of sconces you like. Use painter's tape to try them on the wall and see how they look to you.

If you're NOT adding sconces, then horizontally; however, if you're adding more width to your wall décor, you need to consider the width of any/all wall decorations in relation to the table or cabinet you're going to place beneath it.

In lieu of stained glass sconces, consider keeping your mirror hung horizontally and add stained glass elsewhere. Perhaps you could replace the clear glass in your door with stained glass or more decorative glass. With the sun shining through it your decorative glass will have more impact on your entry than it would hanging on a wall.

If the frame is built for the purpose, you might even be able to keep the clear glass in your door and hang stained glass attached to the door but not a part of it. It would need to be securely fixed in place and not move at all as the door opens/closes.