I think I made mine about 6-7 inches, and yes I definitely stitch the bury in place for this application.
The splicing instructions call for specific bury lengths, depending on the diameter of the rope. My bury length probably doesn't maintain the *full* strength possible, but I have tested it to weights far above what it will be subject to in the hammock without any incident. I'm confident in the strength.
Relevant links-
Samson's 12-Strand Eye Splice Instructions (for 1/8" Amsteel)
Samson's 8-Strand Eye Splice Instructions (for 7/64" Amsteel)
Wikipedia Chart of Fid Lengths for various rope diameters
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