When I went to see it I was really confused as well about how it all works, but it is done really well. I just wish they would get a better way to line people up before they open the viewing area
Because I wanted to be front and center, I arrived to the viewing around about an hour and 15 minutes BEFORE the return time on the fast pass. This was about 2 hours and 30 minutes before showtime! I asked around where the "yellow" group stands and found out that there are two yellow groups...not what I wanted to hear. However, the CM pointed me to an area to wait, and so I did. More and more people kept arriving and I just stood my ground and did not move from where the CM told me to stand. Sure enough, when it was time to start moving, he came up to me and told me to follow him. The trail of other yellow ticket holders behind me followed as we walked into the yellow area. Once you hand your ticket over, it is a mad dash to claim a spot...people running around everywhere! I got to the tier right above the front area and noticed that the area below me was a "wet" zone and there was a section of the rope the blocks the "yellow" viewers from getting to the first row missing, and instead it lead down to the front row! I just walked down there and got a front row spot....as close to the center as possible.
Of course, after I made it down here, some other yellow viewers noticed and did the same thing. The red zone was a little delayed so they were not down there yet either so we had a chance to pick the best spots.
So, long story short, if you really want a great spot, get there super early! Ask where you line up, and just park it there. People that were arriving 10-15 minutes before the return time on their tickets were not getting front tier areas because the line was already really, really long. Just be prepared for a lot of standing! Its a great show if you can get good spots! The 2nd night I watched it was disappointing because of where I was standing. Really bad view. Personally I feel Disney really messed up with the way they handle viewing of this show, but it is to late for them to really make any changes.