Here's a wiring diagram that shows the proper way to install a voltage regulator. This example is what I use in my Raptor 50, I run a flat pack of Lithium Polymer 2200mah batteries. The regulator is a DuraLite 5.1v and the switch is the heavy duty Futaba.

I've been using NiMH for the last few years and they've served me well. However, once I purchased a Fury Extreme with all digitals I found even a 2700mah 4.8v pack would sag heavily under strong voltage situations. Dangerously low.

I chose to go Lithium as they've started to come of age, proven reliability and very potent. I wanted the higher voltage pack so when I really leaned on the battery it would still deliver proper voltage.

I believe having regulated voltage will improve the life of the electronics and make them less prone to any hiccups that may be caused by rapid and deep voltage drops.

You always want the regulator installed BETWEEN the SWITCH and RECEIVER. If you install it between the switch and battery you will drain your battery down.

This same scenario applies if you're using a 6v NiCad or NiMH set. I keep my regulator (which is a Duralite) exposed so it can keep cool. Remember a regulator can get very warm in use, especially during peak demand periods. I have mine on the front of the battery tray strapped down with ZIP ties.