On her marriage she becomes automatically Princess William of Wales and Royal Highness. It is usual in recent history for Prince's of The Blood with no other title to be granted a title to avoid the confusion over their wives styles. The Queen doesn't request a title to be granted she simply grants it.
One other option that few people have pointed out is that William could simply use a courtesy title (one of his father's lesser one's - for example Earl of Chester).
The Wales style issue is a silly one - we've had Princesses of Wales for centuries. Camilla is legally Princess of Wales but doesn't use it because of sensitivities over the late Diana which is understandable if rather daft. In due course i have no doubt Catherine will be Princess of Wales (on Charles accession to the throne). She certainly will become Duchess of Cornwall at the moment Charles becomes King (the title is automatic to the male heir to the throne whilst Wales has to be created).
One current problem is the lack of traditional royal titles - Victoria avoided the traditional ones for her children because of the associations with her own Hannoverian Uncles - but used traditional titles for her grandsons - Duke of Clarence for Prince Eddie (first used for the second son of Edward III and again for the eldest brother of Edward IV - fell out of useage and York became the preferred title for a second son) and Duke of York for the the future George V.
George V reverted to tradition - using York, Gloucester and Kent for his second, third and fourth surviving sons. The present Queen used tradition for her second son but respected the wishes of her youngest son with regard his wish to have his father's Dukedom which he can only have on the death of the Queen and Prince Philip (as a new creation).
The only really vacant ones are Clarence and Cambridge (Clarence has dodgy associations - the murder of George Duke of Clarence in the 1470s and the early death of Prince Eddie - Edward VII's eldest son) - Cambridge is a relatively recent royal dukedom (first used in the 17th century for sons of the Duke of York who was heir presumptive as the brother of Charles II) but has strong associations for the Queen as Queen Mary's mother was the sister of the last Hannoverian Duke of Cambridge (who married in contravention of the Royal Marriages Act and couldn't pass the title to his descendants) - Queen Mary's brother Adolphus was created Marquess of Cambridge in 1917 when he relinquished his German styles the title is now extinct though.
Most of the traditional titles aren't extinct and not likely to be - Kent and Gloucester have plenty of heirs and spares, York won't fall vacant again until the death of Prince Andrew (his daughters can't inherit it). Of the titles used by the Hannoverians and for Queen Victoria's sons - Albany is suspended (but belongs to the descendants of the Duke of Saxe Cogurg Gotha), Cumberland is also suspended (would by rights belong to Prince Ernst of Hannover), Edinburgh is held by the Queen's husband, and Connaught is extinct but unlikely because it is an Irish province.
There is of course nothing to stop the Queen (and William) choosing any title though!
