Which smoker box is better? A stainless steel or cast iron one? Where do you recommend placing it? Directly on the cooking grid or under the grid on top of the ceramic flame reducing plates (or on top of flavored bars)?

That is personal preference. Some people like the stainless steel and others prefer the cast iron. After filling with your wet wood chips, you just place it on the cooking grid or on the ceramics- do this on a cold grill!