I hate to be a broken record and internet police, your procedure is 100% correct but there is no "straight up" timing set or position on the gear. One of my pet peeves, although I don't want to be "that guy" either, your advice was absolutely correct of course
There is zero, or advance and retard on a timing set. The term "straight up" means that the cam has been installed with both intake and exhaust centerlines the same, if you looked at the cam lobes from from the front, the two lobes would be in an equal position and not leaning one way or the other (advance or retard). In fact, if you wanted a cam that has 4 degrees advance to sit "straight up" , you'd have to use the 4 degree retarded position on the gear
In the end, when do you need it? When your cam doesn't end up where you want it. Or, if you want to try to adjust cam timing later for tuning..... Easy thing is to buy it up front and adjust as soon as you degree, otherwise, you have to buy a second set or drill for an offset bushing, etc. Normally, you shouldn't have to, but with tolerance stack and/or combos where you want to adjust cam centerline, it's there
Last thing, you asked how to use it....let's say you degree your cam and intake centerline is supposed to be at 106. When you check it using the zero slot, it's at 108. You advance it 2 degrees by using the +2 slot and recheck centerline, it should be on 106.
Now picking a centerline, different story, it is a combination of experience, art and math. We all have our techniques and it varies on the build