We will be travelling from Picton to Wellington via the ferry. We have a 3:50pm flight that day from Wellington to Sydney. I am wondering if we will have enough time to get off the ferry and to the airport if we take a 10am ferry, which arrives in Wellington at 1pm. Not sure how far the airport is or how long it takes to diesmbark, etc. We are not the type that like to be last minute, rushing to catch a flight. Will this be sufficient time or should we take an earlier ferry (which will get us into Wellington at 8:30am).

Plenty of time I would think. It is less than 30 minutes from ferry to airport.

gms:

You can fly Soundsair from Picton to Wellington in about 20 minutes. They have a web site.
John

When I took the ferry from Wellington to Picton the ferry was approximately 45 minutes late. I had to connect to the Tranzcoastal train in Picton, because there were many Tranzcoastal passengers on the ferry the train waited for all passengers to connect - we arrived in Christchurch about 35 minutes late.
If you have to transfer to the airport in Wellington allow time for this, you do not want to miss your flight in case the ferry is late or are delayed due to another reason.
Consider flying to Wellington - not necessary from Picton, maybe, from Christchurch, or somewhere else on the south island, depending on your travel itinery.

As RJames has mentioned, delays do occur with the ferry crossings.

Even though you have plenty of time if everything is on time you could be cutting it very fine if something goes wrong.

Occasionally bad weather causes cancelled sailings, maybe you could reconsider your route and fly to Wellington from Christchurch or Dunedin as RJames suggested ~

This might take the pressure off the last day of your holiday and make it more relaxing for you.