I know how to install it, so no funny business regarding the thread name.
I just had my HD on my MacBook Pro fail and got a new one installed.

I'm just curious if all you guys install on the native mac drive or an external? what do you suggest?

An upgrade of FCP looks for your old copy in your applications folder on your system drive where you want to install all your applications. So yes, install FCP on your system drive and your media on another drive.