I've been using them for a couple of seasons now and have come up with this way of using them-
Live bait- 1 hook in the lips, one by the tail
dead bait - 1 hook in the back of the head, odd hook in the fish so the shank lays flat, one by the dorsal fin to try and get it to hang level
The ideal situation is to set the hook as soon as they start running with it, if you're standing right there when your flag goes up this is not a problem, if you're not they are more than likely going to swallow at least the front hook and make releasing them difficult if that is what you want to do. What I started doing last year and have experimented with many different ways is this-
Set you bait for the depth you want, then peel off about 5 more feet of line and take a rubberband and loop it around your main line and thru itself, tighten it up around the main line and then wrap it around your spool 1 or 2 times and then wrap that 5 feet back on the spool and set your flag. When the fish hits your bait and takes off it will get 5 feet of line and then the hooks will be set by the rubberband, If it is a big fish it will pull a few times and then break the rubberband and be off to the races, but at least it is hooked already and it can't swallow the bait any further. I have had very good success with this last year and it is working great this year too. Almost all fish will be hooked in the mouth some where just like they had hit a stick bait. Try it, you'll like it. just don't use it on junky tipups as a big fish will give it a work out when it gets to the rubberband and then again at the bottom of your spool