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Well that's an open ended question... It all depends on what you are doing with your truck, daily driver, drag racing, is your motor a race motor?
But to answer your question I do believe an X-pipe does help the flow of the exhaust instead of an h-pipe. Now size I have friends that run 3 inch pipe but they have big cubic inch with big cams. I personal think 2 1/4 is good for a V8 unless your a big cubic inch guy. My truck came with 3 inch single with a manga flow muffler and I'm not going to change it for my EFI 351w.
Where to put it, between the motor and the mufflers... Just kidding I think any were you can find room before the mufflers is good.
You can also run dual in and dual out muffler then you an x pipe ish system.
Rezvani's Latest Post-Apocalytic Monster Is a Ford F-150 Raptor Underneath
Slideshow: Called the Fortress, the 850-horsepower pickup combines Raptor underpinnings with military-inspired features, survival equipment, and a starting price of $285,000.