I use the two prong spots and, after watching Nolans video on Holsters, made a tool to help set the prongs in the back.
For the 1/4" spots, for example, I went out and got a 1/4" punch ($2 at Sears). I rounded the tip slightly on my grinder and polished it up on my felt wheel. For the 3/8" spots, I got a 3/8" long bolt and cut off the threads before rounding. Probably could have used a 1/4" bolt as well but I wasn't thinking that far ahead the first time.
Now, after I bend the prongs down, I slightly dampen the back of the leather between the prongs and use the punch to set the prongs down into the leather.
The "dome" shape on the punch combined with the damp leather sets them below the surface of the leather. haven't had any problems so far with scratching.
Be sure and have the spot face down on a rubber matt or another peice of leather.