You will want to scan at at least the size that you want to print at. If you're scanning an 8x10 and plan on printing at 16x20 then minimum would be to scan at 600 dpi. But that's assuming that you're scanner's effective dpi is 100%. The Epson V700 for example only scans at effectively 40% according to this site
Test report flatbed-film-scanner Epson Perfection V700 Photo with transparency unit: experiences, image quality, scanning so if you wanted to get an effective dpi of 600 dpi you'd want to scan at 1500 dpi to achieve the sharpness equal to 600 dpi. I have heard that with large format negatives it doesn't do much good, resolution wise, to scan higher than you need.
This is an hugely inaccurate statement. The review you mention is talking about realistic maximum resolution, not error factor at each resolution. (There is a larger problem with the review, but more on that in a minute.) So, if you want to scan the 8x10 with the scanner set at 600 dpi, just set the scanner to that value, you do not need to scan at 1500 dpi to achieve 600 dpi quality. That's just wrong.
An Epson V700 is a great scanner for 8x10 film. You will get all the resolution you could possibly use in normal printing with very low scanner settings, well within the quality range of the Epson. And with VueScan or ScanFast software, you can scan in multiple passes with different scan exposure settings, allowing you to dig into shadows and get fine highlight detail in difficult negatives. For 8x10 you just don't need any more scanner than the Epson.
The larger problem with the ScanDig review linked above is this: The Epson v700 does not have a focuser, so you are stuck with wherever the focus is as assembled. The depth of field of the plane of sharp focus for the film scanning lenses is very, very narrow, so it is important to move the film into that plane accurately. The standard film holders provided by Epson do not give you sufficient control of film height to assure that the film is precisely in the sharpest focus area, and the focus height of v700 varies widely from unit to unit.
Most scanner reviewers have not taken this into account, and their resolution evaluations are not accurate as a result.
At low scan resolutions, like 600dpi, this won't matter. The focus is quite good enough to offer accuracy. But at high resolution, say, above 1500 dpi, focus starts to matter. At 2400 dpi, images will be very soft as you would expect if the film is not in focus. Get the focus plane right and you can get good results up to at least 3200 dpi, perhaps up to 4800 dpi. You can either focus by carefully shimming the OEM holders, or do what most folks who care about this do: get a betterscanning.com film holder, which has infinitely variable adjustment, and holds the film very flat (using their universal mounting station with wet/dry option, mounting under the glass). Flatness matters a lot. With this holder I can scan 35mm up to 4800 dpi and get sharp, well detailed results with very little sharpening required in post.
You won't need this for 8x10 film though. You can scan right on the bed and get great scans for print sizes you care about.
Regarding dealing with very large image files in Photoshop: there is a trick! I learned this from a website that I no longer have the link to, but basically you do this (assumes full Photoshop, not Elements):
1. Load the full size scanned image into Photoshop.
2. Duplicate the image (Image->Duplicate I thnk). You now have two identical images in two tabs.
3. Resize of the duplicate image to something smaller, like 1200 on the long side, keeping proportions. This second image will now be consuming much less memory.
4. Do all your edits on this duplicate,
using only Adjustment Layers. Use one adjustment layer per edit. Don't do edits that can't be done in adjustment layers at this stage, such as sharpening.
5. When you have everything to your liking, select and copy the adjustment layers, and paste them onto the full size image. Your edits will instantly be applied to the large image accurately.
6. Sharpen and do any other image-wide tweaks required that can't be done in adjustment layers. You are done!
I've found this to work very well for extremely large images that otherwise would bring my computer to its knees. Good luck!