Charrie -
I have been several times. You will be on the field with the balloons and surrounded by up to 800 balloons during the mass ascension. There is no such thing as a bad location. The best advice I can give you is to keep Sandia to you back because that is where the sun will be coming up. Get there early (5-5:30AM) to avoid the traffic and get yourself a hot cup of coffee and a breakfast burrito before the Dawn Patrol goes up.
Take a tripod or at least a monopod (my choice) for the morning events - It will be very dark when the dawn patrol goes up. Even when the ascension starts, most of the field will still be in shade. I would carry a small bag with two lenses : a wide to standard zoom and a standard to telephoto zoom (in my case a 24-60 and an 80-200). A circular polarizer can be handy as well.
As far as special locations go, the area by the Gondola Club on the SW corner of the field is actually a golf instruction center when the balloons are not in town. There is a man made water feature that flows through the area that will afford you the opportunity to get some reflection shots if that is of interest to you.
If you would like to look at some examples of what you can get, follow this link to my website. You might also look up Joe Lorenzini on TPF - he has some real nice work from the balloon festival.
Here is my website:
Lemmings Walk Photography - Fireworks and Balloons
Be patient with the weather and enjoy. It is worth it.
HFM