It can be anywhere in the supply line after the PRV, but the usual place is between the water heater and the PRV. The exact orientation of the tank is not important, but it must be supported. I think the best way is to install it so that it hangs below the pipe. That way the pipes can be strapped to a floor joist on both sides of the tank and provide excellent support. However, sometimes the physical location of the pipes make that difficult or impossible, and then other means of support must be provided. There are several suggestions on the Watts box.