I am installing a Cisco Core Switch 3550-12G. In all of my closets I am cascading at least (5) 3550-48-SMI switches. I was told not to cascade any more than (3) switches or 144 ports back to the core switch. I must then break the stack and run fiber back to the core switch to start another stack of switches. I was told to install these switches this way, because of the limitations of IEEE 802.1d (Spanning Tree). Is this true? Feel free to give me your suggestions on how to set this up.
IEEE Spanning Tree does have a seven bridge hop limitation. You might still be ok with a five switch cascade but that will be pushing it. Personally i would not cascade more than 3 switches myself and for higher port requirements i will seriouly look into a chassis based switch or break the stack as has been recommended to you. Make sure you document and hardcode your layer-2 topology when deploying the stacking solution.
I`m not sure whether you are aware of this or not--in stacking you will always get half-duplex. but if you connect your switches in point to point fashion you will get full-duplex which will enhance your network performance.
here is the link which will guide you about point to point and stacking connections. you can divide your switches stack in 2 and 3 switches and connect this via a MMF cable. This solution will give you maximum throughput out of your investment.