From what I read in the Faller book, the wire should be right under no more than paint on the surface. Magnet force falls off as the cube of the distance, so a small amount of extra distance from the wire can make a large difference in steering. Apparently you can also have the magnetic force too strong, another interesting issue.
Watching with Interest as I've already decided that my upcoming town build will be using this system instead of the Streets stuff I was planning. Anyone want to buy some Streets track? 
