Dsegal describes the way I do it most of the time. Doing this way allows you to not have any gap at all and you can leave the trailing edge of the wing flat and the leading edge of the aileron flat; i.e. butted tight against each other. I do iron on a strip of the proper color over the mating edges and lap about 1/4 inch on top and bottom before ironing on the hinge material. Apply the hinges prior to covering the wing and ailerons. I use this on 1/4 scale sized planes as well. I have used Monocote, Solartex, and Ultracote--all work equally well. I have never had a hinge failure in well over 12 years of using this type hinge, in fact my big Phaeton 90 with a Quadra 72 on it, is now over 12 years old and an esitmated 1000 plus flights is still going strong with this type of hinge.
A gentlment named Swooper put a good picture of this on
http://www.flightlines.com/forum/For...ML/000053.html but I do not think it is any longer accessable. Perhaps if he sees this he would be so kind as to reissue that graphic as it was extremely good.