When you are setting up you should remember the primary 3 senses the coyote uses to hunt, and the way/order they are used. Keep all this in mind while also remembering that usually the only sense we use is sight (I've only ever heard one coyote approach before I saw it). So, you have to see the coyote coming before he picks you up with any of his 3 senses.
The order is sound-sight-scent. Obviously, the calling gets them interested. If they are interested enough, they may forego the other 2 senses and approach directly, sometimes at mach 2. If they are more curious, they hear the sound, then look to see what's going on. Again, if they hear and see something that looks like meal time, they might forget about the scent thing and come straight at the call. This is where a decoy can really help. They hear it, see it, come straight at it without regard to scent. Many will say that the sight part is the most important, and if you can fool this one, the battle is won.
Final scenario is if they hear it, but something doesn't look or seem right, they will want to catch a wiff to verify what they are hearing. You can't fool this one, no matter how hard you try. The only thing you can do is avoid it.
So, back to your question of where to set up. That will depend on where you think the coyotes are (scouting as mentioned will help with that one), and where you want them to go based on the senses they use, and the only sense you use. Set up where you can see the widest approach area and take advantage of the first 2 hunting senses of the coyote without them switching to the 3rd sense is key.
Now, also bear in mind this is coyote hunting, so none of this may apply... 
