You go over to the area by Rivers of America, in front of Haunted Mansion, the steps near the churros cart. They will be setting up behind a roped off area, the raised area in front of the river. A CM will pull out a podium and start taking seat reservations, I think it's at 8 p.m. When you get to her at the front of the line, she will show you a seating chart and which seats are left, and will recommend the best ones still available. Then she writes the seat numbers on the back of your tickets * and you wander off to find your family. Those seats are then assigned to you. When you come back later to be seated, you show your tickets to the CM, and they will show you to your seats.
*your tickets to the F! reserved seating need to be picked up before 5 p.m. the day of the show, I believe. You need them to get your seat assignments. You pick them up at Guest Services outside the turnstiles.
If you show up without choosing seats beforehand, you will just take what is left. There are 4 rows, I think? Usually the view is just fine, if somebody big sits in front of you it's a matter of occasionally leaning to the left or right a bit. But it IS nice to have front row seats, especially with small kids. We had second row, and we thought it was a great view.
Here's an old thread with pictures and more info. You can see what the snack box looks like, and I think it shows the exact area you sit. But it says the old checkin time of 7 p.m.-- as I said, I think it's 8 now?
http://www.disboards.com/showthread.php?t=1815941&page=4
HTH!