Got a new Truck (new to me)

Not sure why you are using a "manual shut-off" control devise for the heater. Also I always like my coil attached to the engine, for limiting vibrations movements. I know anti-freeze is for cold climates, to help keep the cooling system from freezing, but I believe it also helps in over heating in the south. I would follow the instructions, 50/50 and distilled water as you noted.

That is the stock location for the coil and it’s in a better spot being away from the hot engine & exhaust. It’ll see less movement there vs on the engine since the engine vibrates and may rock a little if, OF the motor mounts are worn even a little bit.