A friend asked how much lit review should be in a dissertation. I know I have talked about this before, but I will post here what I posted on his fb page:
Rule 1: Listen to your adviser and the rest of the dissertation committee--they are your gatekeepers, not random facebook friends.
Rule 2: Read a bit of other dissertations that made it through your program and were seen as successes--read for style, not content. If you want your dissertation to be a book someday, then skim your favorite books that are in the same area as your dissertation and see what works in their style.
Rule 3: If brevity is rewarded, or at least not punished, then there should be no section called "lit review" but rather you should demonstrate your mastery of the literature via how you address
- why this question is important (the literature says it is important)
- why this question needs to be asked (the literature has f-ed it up)
- potential answers to the question come from the literature
- your answer probably builds on existing approaches (from this arena or elsewhere).
My students tended to have lit heavy intro chapters and theory chapters, but I would criticize them if they had sections called lit review since nothing is more boring than endless lit review.
Which leads to my real number one rule: if it does not fit, drop it. So, cite the literature that is relevant for the building of your argument but not extraneous stuff.
Again, your mileage may vary depending on the standards of your committee and your program.