islandwiz1, if you are going to cross hatch, do what is most comfortable for you. 2" is ok, but 1" has more impact. I would not put the cross hatch over the applique, I would quilt around it.
If it were me, even if I used my domestic machine, I would quilt around the applique, if some of the pieces are real large, I would quilt with the same color thread if possible as the applique to tack them down so they will not be coming off if a stich is cut accidently. Then I would do a variety of background fills. Leah Day has a series on background fills that could give you some ideas. It all depends on the impact you want. Then I would be sure to stabilize the quilt with a stitch in the ditch around each block, corner stone, and border. This will help so you do not get any puckers on it while quilting. On the borders and sashings, I would do a feather with a stem inside it and maybe an echo. Yes, maybe more than you want to do, but that is what I would do. The quilt is so gorgeous, it needs a quilt job on it the same as your awesome work!