I have been hand quilting for 18 years and I've done it every which way when choosing thread colors. It really depends on the look I want and what the quilt will be used for.
You don't want to cut your thread any longer than 18-inches, and for the exact reason that was listed above. Too much longer and it frays, tangles, and all that not-so-fun stuff. I always use either wax or the thread conditioner in the little blue box called "Thread Heaven." These keep my thread from tangling and it works wonderfully!
If you buy thread marked 'Hand Quilting Thread,' it is already waxed, which is why it is such a no-no to use in your sewing machine. It gums the machine up something fierce. :( Also, hand quilting thread is wound differently than machine quilting thread or thread made for sewing machines. It isn't such a big deal to use the sewing machine thread to hand quilt, though it really helps to condition the thread with bees wax or the Thread Heaven, but you never want to use hand quilting thread on your machine. Hope this helps some.