One file per component or several files per component?
One reason for "one file per component" is resiliency. When an application is started, Windows Installer can check whether the keypath of any component is missing. If the keypath is missing, the component is reinstalled/repaired.
If a component has multiple files, then only one file can be the keypath. In wix you indicate this by setting KeyPath=yes on a File element. The other files will then not be fully protected by Windows Installer resiliency. They will only be reinstalled if the keypath file goes missing.
Another reason to have "one file per component" is when installing files to locations where they may already be present (e.g. an application upgrade, or when installing to c:\windows\system32). Windows installer determines whether a component needs to be installed by checking the keypath. If the keypath is a file and the file is already there (with the same version or higher) then the component is not installed. That's a problem if the other files in the component actually needed to be installed/upgraded.
I follow the Microsoft approach which is also used by InstallShield: http://msdn.microsoft.com/en-us/library/aa368269(VS.85).aspx
The above link gives the advantages of this approach.
The relevant part is:
- Define a new component for every .exe, .dll, and .ocx file. Designate these files as the key path files of their components.