For convoys, the best place I've found to hang out is the area around AL03 and AL38 off western Scotland. You can almost always catch convoys doing the Halifax - Liverpool run.
For single ships, my favorite place is the 4 grids of BE39 & 63 and BF17 & 41, off southwest Ireland. Especially 1939 thru 1941 when the air cover doesn't reach there. You can catch a lot of single ships there, mostly coastal & small merchants, and C2's & C3's, with an occaisional tanker thrown in.
For mods, I'm only running SH3 Commander, v 1.43. It's got a lot of different mods added to a very cool career manager. Lots of folks on here are running RuB, but that's a little too hardcore for me! I'm happy with my 73% realism. If you do a search on UnRealUBoat, you can get a list of the things that can be turned off with it.
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