All wrong as you say, there is no right way and wrong way as such just ways that work ways that don't.
The lowest point is where the oil will collect due to the weight of it, so the lowest point is the drain back to the sump, which as you rightly point out MUST be at oil level, ie not open into sump but going directly into the side and joining the other oil, some use the sump plug with an adaptor welded on it for this to connect the return pipe to, the top most one should be the breather itself, the others used for the breather pipe take offs on engine, the kidney box serves a useful function in that it uses a trap/deflector arrangement so a lot of the oil simply hits this and drops back down, leaving the lighter stuff to vent out.
A easy way to make a breather for around £10 is to use a welded up canister, full of stainless steel scrub buds, the things used for scouring pans etc, works perfectly.
tabetha