I do all my beers in a tun made from a 10 gallon coleman cooler, even the ones that only use a couple lbs of grains. I've never had an issue with the deadspace. If you're using a rectangular cooler, it might be different though.
I like to shoot for 1.25, but since I SUCK at hitting my mash temp, I'm sure I usually end up closer to 2 when all is said and done from adding hot or cold water to adjust.
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