I would support something along the line of interwiki links in the header, but to wiktionary, for article titles that are also words with definitions. I don't think we should liberally spread through links to Wiktionary in running text though. In the worst case that would result in every single word in Wikipedia being hyperlinked to its definition, which would be a bit strange. Even if only "unusual" words were hyperlinked, it'd have a negative stylistic effect in highlighting the "big words". It'd also have a subtle hint of "this is a word you might not know", and given the wide variation in vocabularies it'd be hard to come up with some reasonable set of such words---much better is to assume everyone knows all words, and let them use a dictionary (such as Wiktionary, or some other online dictionary, or one of their desk) on their own if they don't.
I agree. Wikipedia is not everything2, and I'd prefer to keep wikilinking analogous to the use of small caps in print encyclopedias (that is, as a pointer to an article of interest in the same topic).
I like being able to look up words conveniently, but that's a feature I'd rather have in my desktop environment. (In my case, this means highlighting a word and hitting command-=) Cluttering a page up with hyperlinks would be confusing at best and counterproductive at worst, even if Wiktionary links are stylistically differentiated (with a different color, perhaps).
-Mark