A design thought - make it so you can simply drop in a traditional 12"x18" pad, then when it wears out or gets ruined, you replace it with an off-the-shelf model. Even better, if you can get a good magician's kit bag with pockets, one of which would be large enough to hold your pad, that would be stellar. Could be as simple as a nice messenger bag or a haversack (it's a shoulder bag that's sized between a map case and a large purse, usually oriented to be taller rather than wider).
I'm not quite sure what you mean with the bag stuff, sounds interesting and all, but if you could clarify...
Its a tv tray with felt on the inside.
With all respect, not even close. But yes, I'm sure I could go lower, I haven't checked the prices on wood and all that yet
EDIT: I almost forgot, what do you guys feel is a good size for a pad like that? I don't perform magic, so I wouldn't really know...
The bag - picture a bag, perhaps the size of a computer bag, large enough to hold your pad (factoring in that it will be a bit larger due to the size the wood adds) that is equipped with a number of pockets, preferably sized to hold popular magician items like packs of cards, coin purses, cups and balls, a wand, whatever. Since the standard small pad is 12x18", your pad will be roughly 13x19". That's roughly equivalent to a notebook with a 15-inch screen, measured diagonally.
I've seen military bags that allow for adding to the inside and/or outside additional pockets using "Alice" clips, "Molle", etc. - I have little clue what that means, But imagine you have a shoulder bag, perhaps oriented vertically so it sticks out less when carried on the shoulder. There's a slim pocket just large enough to hold that nice pad, then there's a big empty space with hook-and-loop/Velcro connectors attached to its walls. 5.11 Tactical Gear sells a vest that has a large interior pockets in the walls of the vest, lined with Velcro and meant to attach smaller pockets to - things like ammo clips, a gun holster, etc. Some of those might be the right size for magic accessories.
As far as size, stick to the standard sizes for easy replacement. The most portable of them would be 12x18". I wouldn't go too much larger - you'd want it to be portable and easily transported. Oh, and SEAL the wood with some type of laminate. If used for things like table hopping, it's not that hard for someone to accidentally spill a drink on it. The pad will be fine, since most are synthetic felt and neoprene, but you don't want to ruin the wood.