Of course, the answer to this depends on the sound that you are trying to achieve but the general idea is that you should be ok if you are going into the plugin at around -12 to -18 dBFS and then adding processing with the plugin to bring the sound up around -10/-6dBFS. It's not necessarily better to drive the plugin with higher input gain but can be done if you want a more saturated sound. 

The THD saturation is not dependent on the level of the incoming audio and instead, it allows you select at which dB level you want the plugin to start applying saturation. At -60dB it will only saturate a small amount and if you bring it up to -30, it will saturate quite heavily.