I whipped up a few prelim notes on a possible git repository layout for MediaWiki core and extensions, splitting out from SVN:
http://www.mediawiki.org/wiki/Git_conversion/Splitting_tests
I've run this past Siebrand to make sure that it should work for the localization batch commits, and he seems to think it sounds sane.
You can check out extensions as separate repositories directly into subfolders within core's 'extensions' dir for a ready-to-run system. But, you *do* need to do either manually or scripted iteration over them to pull updates or commit across repos. Git's submodules might be a useful way to help automate checkouts, but they introduce their own complications for maintenance.
There's a shell script on that page to make a sample checkout not including any history -- just exporting latest code to make sure the layout makes sense. Real conversion will probably want to include version history and release branches/tags for both core and extensions.
Note that there's lots of other stuff in the MediaWiki subversion repo that will want to be split out as well -- but for now our lives are simplified by only worrying about MediaWiki and maintained extensions. ;)
Please do feel free to comment or ask questions -- things are malleable and feedback will be *very* helpful in finalizing plans and building documentation.
-- brion