The magic circle your feet leave in the dust of the forge, idealy should be round, and as small as you can comfortably work in. From forge to anvil, to power hammer, to vise, to forge. as few steps as necessary. I have two "smallish" london pattern anvils,as i face the forge the one on my left with horn facing forge has a hardy in it most of the time, off to my left and out of the way as far as the danger of hitting it with hand accidentally. So that one is placed so the very sharp horn is out of the way of my thighs and private parts while dancing around in the excited way i get sometimes. The anvil on my right usually has a scroll jig in the hardy hole, or a scroll starter, and is placed so the horn is to my left as i am right handed and that seemed to me the "right" way to set it. So it is really a matter of preferrence, and not some "RULE". The flat side goes up, sometimes. Oh and my third anvil, is a larger london pattern, set on a moveable base so it points anywhere i want it. This anvil is set about an inch lower than the others as it is used for a striker anvil. I say do whats right for you.