I think everyone does it a little differently. Some of it depends on what your skin requires. Mine's a bit picky and gets angry easily, so I use a lot of powder and some AF (antifungal) products.
My morning routine:
- lay a diaper down on the bed open, sit down on it, and applying a small amount of AF powder in my crotch on the sides
- get up and lay down the open diaper in front of the cabinet
- stand over the diaper and apply cornstarch to my inner thighs
- apply a heavy coating of talc under both butt cheeks (where the rear elastic gathers go)
- pull on a diaper I pretaped yesterday and get it all squared up
- pull back the left wing from my hip and squirt in another good dose of talc - repeat on right side
- pick up "drop cloth" diaper from floor and pretape it for wearing tomorrow
I suppose to some that sounds like a lot of work, but I get pimples sooooo easy on my skin, under my cheeks or on my hips, that I have to do this to keep my skin healthy while I wear 24/7. For me it's totally worth it.
As for talc, I'm not too worried about it, but I do try to avoid inhaling very much of it. (I know, opinions here will vary) It smells nice, but isn't too good for the body internally. Breathe through your nose when handling talc, so it's most likely to get trapped in your nose mucus rather than go into your lungs.