both methods are used. putting the diode in series means you lose 0.7v across the diode. putting the diode across the power terminals requires a high current diode, preferably rated at a higher current than the fuse (always use a fuse). i've seen these diodes used in CB radios, and often they are 1N4004's. the problem is that if the radio is fused for 5 amps, and the diode is a 1 amp type, the diode often shorts, then burns open before the fuse blows. then all the expensive parts that were supposed to be protected, get hit with the reverse voltage the diode was protecting against. if the device needs to be fused for 5A, then use a 6A diode.
actually, come to think of it a series diode needs to be rated at a current higher than the load will draw. losing that 0.7V often isn't a problem, except for things with audio amplifiers or transmitters inside where you want Vcc to be as high as possible. i get a lot of car audio to work on, and all the manufacturers use a diode across the power terminals.