Cleat position is a really interesting topic, as there are four planes for adjustment: fore-aft (the position of the center of the cleat in relationship to the ball of the foot); side-to-side (the distance of the cleat from the crank arm); height (are shims used to equalize leg length); float (the amount of angular movement available for the heel to pivot above the axle of the pedal). Cleat position is influenced by a number of factors, such as individual morphology and biomechanics; the how the heel tracks vertically during the pedal stroke (e.g., at the bottom of the pedal stroke, is the heel horizontal, pointed down, or pointed up); preferred average cadence; preferred gear ratios; and distance/type of event. A good fitter will try to factor in all of these variables when setting up your position.
Now, some details. There is no loss of power associated with pedal float--in other words, using a free-float pedal such as Speedplays does not offer any greater or lesser advantage than a pedal with less float or restricted float. Cleat size and pedal platform size really isn't much of an issue any more, as most quality cycling shoes are stiff enough that there is no penalty associated with cleat/platform size. If a rider is having hot spots underneath the foot, then the sole of the shoe is not stiff enough, or orthotics might be indicated. The height of the cleat does have some impact on aerodynamics, but no significant impact on power product (this is for relatively current styles of pedals). So, in other words, use the pedal style that you like the most and don't worry about negative impact on performance, assuming that you have decent shoes.
Positioning the cleat on the shoe is much more idiosyncratic. A good fitter will carefully document how your heel and knees track as you pedal, the angle of your feet in relationship with the crank (and whether this angle changes during the pedal stroke), how the foot tracks vertically during the pedal stroke, and whether there are any anatomical or muscular variances that impact the pedal stroke. All of this said, there are some *general* principles that one might consider. If one rides predominantly with the front of the shoe pointed downward (i.e., raised heel--do a Google search for Jacques Anquetile) and if one tends to push smaller gears at higher cadences, then positioning the cleat slightly forward of the pedal axle might be advantageous. If one tends to drop the heel at the bottom of the pedal stroke, and if one prefers pushing bigger gears, then positioning the cleat slightly behind the pedal axle might be advantageous. When in doubt, start with the ball of the foot centered over the pedal axle.
There have been some interesting experiments in positioning the cleat underneath the arch of the foot; advocates of this suggest that a mid-foot cleat position is more effective than traditional locations. While I tend to slam my cleats as far back as my shoes allow, my cleat position is not as extreme as what some riders suggest.
Short form: if you're going to do very short events at very high cadences, then consider sliding the cleat slightly forward; if you're going to do longer events, at lower cadences and in higher gear ratios, slide the cleats back. Of course, these are generic suggestions--you absolutely need to factor in your specific considerations. Finally, use the best quality shoes that you can afford; doing so will eliminate the problem of flexible soles and pressure points associated with cleat design.
Me--I use Speedplay X pedals (lots of float; extremely solid pedal retention; very easy to setup); my cleats are pushed back as far as they go (I drop my heel at the bottom of my pedal stroke, and I push big gears); and my favorite shoes are track shoes with remarkably stiff wooden soles (these are for the track). On the road, I always will use a quality shoe with a carbon composite sole.
Don: Cycling Tech >