There's a link to a Boss page in there that allows you to download a very very helpful .pdf file about specific pedals. It only deals with the Boss line of pedals but it will give you a very good idea of how they work and how to tweek them...
As for distortion and overdrive. It's been an age old question: "Should I overdrive the distortion or distort the overdrive?" It's up to personal perference... A lot of people, professionals and the like, Use a dirty amp rather than a single amp with a distortion and overdrive pedal on a certain channel. They will find an amp with a really good dirty sound and an amp with a really good clean sound, since it's reaaaallly hard to find an amp that does both superbly. It's just one of those compromises that you have to make...
In relation to a non-professional setup: Most people tend to overdrive the distortion. I do it, Zakk Wylde does it, plenty of others do it as well... What I do is dial in a tad bit of distortion in my dirty channel on my amp. Then I put my overdrive pedal in front of it. Of course, the overdrive pedal makes a big difference in the sound... A cheap Danelectro overdrive isn't going to sound like an Ibanez TubeScreamer-808. TubeScreamers are about all I will ever use... I have a TS-808 and I love it. However, they're mostly designed to work with a tube driven amp rather than a solid state amp.
But I guess before I can offer you specific advice about how you should set yours up, I should ask what specific tone are you looking for??
I prefer a nice smooth tone with a very very tiny bit of break up when I really lay into the strings. My tone is probably too bluesy for most, but I like it and that's what matters.
