Suggestions required on catalog size and moving master to a virtual machine

About your catalog size question:

 Is this because of the difference in version of NetBackup? 

No. Catalog size is determined by the number of files backed up, directory depth (each path needs an entry in the catalogs) and retention levels.

So, a File and Print server with 500GB backup size consisting of millions of files will have bigger catalog entries in images folder than a Oracle server with 500GB of data that consist of 10 db files.

NBU Admin Guide I has a section on catalog space calculations.

PS:
Your 1st master server is getting too big.
Symantec recommends no bigger catalog that 1TB.
Probably time to setup a new master and move some of the clients off this environment.

See recommendations in this Vision presentation:

NetBackup 7.6 Best Practices: Optimizing Performance 

Another good doc: 

Updated NetBackup Backup Planning and Performance Tuning Guide for Release 7.5 and Release 7.6