The reef hook is affixed to the boom just aft of the gooseneck:
I always heave-to in order to set/shake out a reef (CB down, jib sheeted to weather, tiller held to the lee side with the tiller tamer, main left loose to swing out to the lee side. Boat will be in "neutral gear", so to speak). Just ease the halyard, pull the first or second luff cringle down onto the hook, and re-tighten the halyard. I take the sail slugs below the cringle out of the sail slot via the mast gate. Then pull the clew reef line tight and set it in the clam cleat, hook the bungees around the loose reefed portion, and you're done.
I always rig the clew reef line through the first leech cringle during setup, as that's the one most likely to be needed/used. If I need to go to the second reef, I just heave-to and re-route it. I've had the second reef point on the sail for about four years and have only used it twice, the second time last month on the first day of the FL 120. Both times I rigged it for the second reef before launching, as I knew I'd need it ... ;-P