TL;DR: However you choose.
If you read my blog, and read my blogroll, you'll find game summaries for a number of GURPS games centered around DF and fantasy gaming.
If you read all of those summaries, you'll probably notice that we don't all play DF the same way.
Which of them, if any, is the "right" way?
Obviously to me, the answer is all of them.
We all seem to run DF differently.
And it's all good.
I really do enjoy reading summaries of games that run differently than mine. And none of us are wrong to run our games the way we and our players find to be fun.
I may get the last word, sometimes, either out of sheer willingness to keep hitting "Reply." Or because I often turn my own game material into books of monsters or rules. But it doesn't matter for those games.
That's a great thing about gaming. Even so many years down the line, if the way I run and enjoy games is or isn't like the ur-games of Arneson and Gygax, whatever. We've taken the ball and run with it and we're enjoying it.
What prompted this? Just me thinking about how my commentary about Death Vision and Unfazeable here and at the Castle Whiterock summaries might be seen as criticizing a game. It's not. It's clearly a fun game that the players enjoy. I just want to engage in the connection a comment affords, and try to make my own game better by seeing what I'd find to be issues before they come up. It's not really me vs. another GM, or our game versus their game. It's purely constructive in intent.
All of that said, the correct way to play Eyes of Death is as amoral haters of everything who lurk in places with good vertical retreat room and plenty of cover vs. arrows. Anything else is wrong. Otherwise, we're good.