Your comments

20.000 lines shouldn't be a problem. Just be sure to use an iPad 2 or a 3rd generation iPad because it has much more RAM than the 1st generation iPad. 

It's also important that the file is not minified - very long lines without line breaks are more problematic than a large number of lines.
Textastic supports TextMate syntax definitions. See http://www.textasticapp.com/v4/manual/lessons/How_can_I_add_my_own_syntax_definitions__themes_and_templates.html 

Unfortunately, I couldn't find a TextMate bundle for VRML.
That's not possible on iOS. All code of an app must be in a single binary that must be reviewed by Apple. This violates the GPL according to some interpretations - that's why for example the VLC app is no longer on the App Store, although the full source code was available... Also, Git requires a shell environment which is not available on iOS.
I had a look at it, but the new version uses a completely new authentication method. Also, apps using the new SDK were rejected.  See http://forums.dropbox.com/topic.php?id=59350 

At the time I last looked when I finished the update for Textastic 4.1, there was no official release that wouldn't result in a reject, but there was only a beta version. I plan to update it in the future, but it is not that easy.
You can already do that: just enter the name in the address field in the preview browser and hit return. Textastic will use that file for all subsequent previews. 

Do you have the latest version of Textastic installed?
Did you get an error message when you tried to upload the file? What kind of file are you trying to update? Did you try to load the site in Safari? Maybe it's a caching issue.
Can you please send an example file with demonstrates the problem to support@textasticapp.com? I can't reproduce it.
You can download the manual as a PDF file from http://www.textasticapp.com/v4/manual/textastic_manual.pdf  and use iBooks or another PDF reader to read it on your iPad.
The next version will allow you to import pictures from the Photo library.