foil insulation works by have a low-emittance surface i.e. heat hits one side but is not emitted through the other. For this to work the foil needs an air space on the non-emitting side, if it is hard-up against something then it will conduct heat through that material, 20mm is enough. Bulk insulation (think fluffy batts) works by slowing down the flow of heat by making it move through a huge number of very small air pockets to reach the other side. In short, a well designed building will always have a combination of both foil and bulk insulation. Your climate will dictate the build up of the wall as you do not want to create a condensation problem within the wall itself. As chookchook2 asked, where are you?

If you can get under the floors then consider just insulating... we added underfloor insulation, its very easy. There are panels of what looks like polystyrene and they just fit up between the floor joints and squeeze in and stay there. We just bought it from the local hardware store. You don't need to hire anyone to install it or screw it in or anything. You just push it in. This is a similar product, there are many brands. http://www.foamex.com.au/polystyrene-products/expol-underfloor-insulation I read that underfloor insulation gives you a similar improvement to the ceiling being insulated. We have certainly found it made our bedroom much warmer! Well worth it. Insulating under the floor will be a better way to stop the drafts... the timber floors will move and shift and anything you fill the gaps with will crack and fall out soon enough.

Judging by the plan, the photos and your comments it appears that too much heat is coming in from high light glazing (clerestory windows) into the lounge and dining areas. Both rooms will be cold in winter because the direct heat from these windows is not enough and not absorbed in an thermal mass and they do not have ground level windows or glazed doors facing north. The elevated floor means that it is cold under the house so heating in winter goes down as well as up. The roof would lack adequate insulation due to the period in which the house was built. The roof tiles probably have another 15 years maybe a bit more so it is costly to insulate from the top (i.e. taking roof tiles off adding insulation then putting roof tiles back in again. The colour of them is contributing a lot to the heat. So what to do. - add external shading device to the highlight glazing, maybe timber battens 40 x 40 at 20mm spacings. This will block direct sunlight within the shading season. That helps to reduce heat intact and see how you go. If that does not work then - add a rigid foam core board to the underside of the timber ceiling, e.g. Foilboard which is 20mm thick r 2, then install a 12mm plywood ceiling lining under this. That way you retain the timber rafter ceilings but also one that has a light coloured (hoop pine ply) timber in between. (Note this is costly) - big gains in heat loss is achieved with underfloor insulation. Try r3 bulk squeezed tightly between the floor joists. Then you can plan for the future with the following - change glass in windows and glazed doors to a low e glass - install insulation into the cavity of the external walls using a company called envirowall. - replace roof tiles with a light coloured metal roof, replace the existing roof battens with a 100 x 40 batten so that you can install a 100mm thick anticon insulation. All of the above costs money and if you don't do it then it costs money to burn energy to keep the living rooms between 21 to 27 degrees year round (what we consider comfortable) so if it tough to decide what to do or not. As an alternative For about 40k you could spend 30 of it on solar cells, and an awesome battery (Tesla powerwall 2) and buy some wall mounted ac units. But that would be kicking the can down the road. But sometimes you have no choice. Good luck

You're right about the insulation up against electric wiring being a potential fire risk. It's commonly done in Australia and unfortunately there aren't many regulations about it, but I don't personally think it's best practice. More importantly though - while adding insulation is always a good idea, it probably won't make too much difference to how warm or cold your house gets. Do you have any sort of heating system in your home? It's really the only way to keep your house warm, especially if you have minimal insulation. Hydronic radiator panels would be a fairly easy retrofit if you have a timber floor, and you'll never be cold again. If it's getting too warm in summer, usually the culprit is too much direct sun getting in. Consider a shade or awning over your north facing windows to reduce some of the direct sunlight getting in. Ceiling fans also make a big difference, and adequate ventilation.