Hands in front of face:
1. You can see the puppets and therefore this is a help in maintaining level, maintaining an eye-line, and helps acting.
2. You can see the audience which helps with eye contact and with pertinent ad libs.
3. You can have a lower booth and therefore need not fear low ceilings. In marquees you are not limited to setting up near the centre.
4. In private houses the kids can sit on the floor, relatively close to the booth, and are still able to see.
1. Tall kids standing near playboard can peer in. Parents can lift kids up to show them the works.
2. You are restricted with your manipulation space between playboard and backcloth.
3. Dances, chases and fights are somewhat limited due partly to narrow performing space, and the fact that the performer cannot turn around.
In my opinion hands in front of face is by far the best choice for general Punch work - domestic/community centre/summer fete/schools etc.
Hands above head would be my choice if I was doing a seaside beach season, street shows or the bigger agricultural shows where I might expect large audiences with many adults.
Punch can be performed in a booth with a plain, self coloured back curtain, or with the backing of a painted scene, often a tudor street scene.
The puppets show up to best advantage, and show detail for the greatest distance, against black,or a dark ground. Puppet costumes look very rich against black velvet. A black backcloth also has the advantage with hands in front of face of disguising the closeness of the backing to the puppets - it adds depth. A painted cloth can be overpowering and detract from the puppets, especially with hands in front of face.
However the booth looks far more attractive between shows, when the puppets are not showing, when it does have a painted scene. Thus it increases the anticipation before the show. This is quite an important point since at many fetes the booth is on display with nothing happening for a far longer time than when an actual performance is taking place. The general attractiveness of proscenium, backcloth etc. is adding a touch of glamour by its very presence.
I think that if we only thought about our audience and the show we would opt for the black. Most of us use painted cloths because WE like them. If we are sensible we paint them in rather muted tones.