I think the best place to mount the 02 sensor would be on the exhaust manifold or else on the downtube just below the exhaust manifold. It should be close to the engine, because heat is required to warm the sensor up, but you need it in a place where exhaust gasses will all go by it so you get a good average from all cylinders.
When installing the 02 sensor be sure to put a little anti-seiz on the threads or else it will be very hard to take out.
Adam
