They come out to start meet and greets right at 7pm, and will continously appear until 11:30(?) I believe is their last set. (meaning they are out until midnight, but the line will be cut off so they leave on time)
People start lining up as early as 4pm (when the party ticket can let you into MK) but that's a little much. My friends got in line right at 6:30 ish, and were meeting them right at the time the headless horseman came around for the first parade (which I THINK is 8:15 .8:30?) I'd say get in line around 6:00. That way you'll be in and out quick once they do come out, and you're not wasting party time on it.
Another idea is to go right at the end of the night. I lucked out, and on the night of Unleash the Villains at Dhs mnsshp was not crowded at all, and I figured I'd see them after the 2nd parade and only waited 15 minutes
People start lining up at 5pm BUT we found that you can get in line to see them during either parade and still be able to see the parade as it goes by with a shorter line. This is of course if they are still on Main St next to City Hall.