It's time to replace that ancient thing...that aside, getting one the right size is important. Check here: http://www.watts.com/pages/support/sizing_ET.asp for some help in sizing. It does require you estimate the volume of water in the beast and piping, though. Also, you need to input the starting temp and the operating temp to determine how much the water will expand and to determine the proper size of the tank.
The tank gets installed on a T, ideally before the circulator pump - it doesn't need any valves or other controls, but you might want a valve on the branch so you can remove and replace the thing without draining the system. If you accidentally leave the valve closed, you will pop the safety overpressure valve on the boiler, since there'll be no place for the water to expand. It doesn't hurt for the expansion tank to be oversized (except for cost and locating the thing), but undersized will either wear it out faster or fail to work properly at all. Because when it does fail (they all do eventually), the thing should be properly supported so it doesn't stress the piping.