I prefer larger bags for the hops because you can stick your spoon in there and give the hops a good stir while they are boiling. At first I didn't stir my bagged hops and the flavor wasn't that great. Now I stir them constantly and the flavor has improved tremendously.
Just toss 'em in loose... forget the bag. You can strain them from the hot wort after the boil or just toss it all in the fermentor and it'll settle with the trub.