[pplucky]

is it better to install this on an sd card? or can i also install it on a usb thumb drive? which one is faster/more stable? got a class 10 sd card...

I've had it already in a class 10 sd card and after changing to an USB thumb drive, I think I won't go back. This allowed me to overclock my 512 RPi, which used to instantly corrupt my STORAGE partition with ANY overclock settings (it no longer happens in the USB thumb drive which contains the STORAGE partition).

Please bare in mind that you will ALWAYS need an SD card to have the SYSTEM partition and to start the boot process, which is quickly handed to USB thumb drive.

and how do i properly install this, with SYSTEM on SD and the rest on the thumb drive? is there any tutorial? (preferrably for windows?)
and which options do you recommend to change as overclocking values?

You won't be able to do it only with Windows, as the USB thumb drive needs to be formatted in Ext4.

I followed the steps from here and after rebooting, partition STORAGE was installed in my USB thumb drive and I could delete the contents of the STORAGE partition in the SD card.