I have experimented with several approaches. I currently find that THE MORE MASS I have above the coals in the WSM - THE MORE STABLE the temperatures remain in the WSM.
I currently use sand in the bottom of the WSM metal water pan. I nest TWO 12" (number 31) clay pot saucers, one on top of the other in the metal WSM water pan. I individually wrap each in heavy duty aluminum foil. Temperatures are very stable and clean up is a breeze.
The Chris' video on wrapping the WSM water pan is useful.
http://www.youtube.com/watch?v=HR5Y3OZwlfc
I double wrap each of the clay saucers in the same fashion, although not as much care is needed to trim the foil, as there is no water involved.
I put just enough sand in the metal WSM water pan to touch the bottom of clay saucer, but not so much as it raises the clay saucers in the metal WSM water pan. I plan to swap out the metal WSM water pan for a Brinkmann Charcol Pan when I get a chance, as it is deeper and wider and should sit a bit more stably on the ears of the WSM grill support straps.
After a cook, I pour the rendered fat out of the top saucer, through a funnel into an apple juice bottle and discard it easily. If I wait until the following day, I carefully gather up the gelled fat in the top aluminum foil layer and throw it away. Double wrapping the clay saucers is a good idea, though Simple Green seems to cut the grease that can seep through a single wrapped clay saucer.
While it is not necessary, I have effectively raised the bottom grill above the WSM water pan / clay saucers by about 1.25" inches to allow smoke and heat to circulate THROUGH the bottom grill.
To raise the bottom grill, I install 4 LONGER screws - (4) 1/4-20 x 1-1/4" screws. These 1-1/4" are used to replace the 4 shorter 5/8 screws that hold the 4 grill straps thru bottom 4 holes in the midsection of the WSM. I prefer Stainless Steel screws, as we live on the ocean, but suit yourself here.
See this image -
http://www.virtualweberbullet.com/misc_images/wsm_cutaway.jpg
By replacing the screws that go through the lower 4 screws in the midsection, you can stably rest the bottom grill on the legs of the screws - 1.25" above the aluminum ledge of the grill straps.
I find arrangement this gives more smoke and color to meats cooked on the bottom grill while not significantly reducing the height available for chickens or ribs cooked in a vertical rack.
Hope this helps you.
/Daniel (minor edits for clarity)