I put the inner cover over the feeder ring to take advantage of the notch for humid air to escape myself, but I put styrofoam on the top cover to break the cold air hitting it causing condensation on the underside. And yes a 5/8" hole is fine IMO, you probably don't have the bad cold winds us Yankees do. I run 1" holes and regulate the size with tapered corks. That way I can peek in there and see if the cluster is getting near the topbars and need sugar blocks.