I would choose to put it on top of the biomedia. In most cases the biomedia will stay in one place while you will change the quilt batting at times. It could be very labor intensive to remove the biomedia every time you replace the batting. Such a small filter sounds like it might be hard to reach, too.

However I can think of situations where I would do something else.

yes you always want the bio last.you want the water clean as possible before the bio.

The water fills the box from the bottom up, so then it would be below the biomedia.

I put some in the bottom last night, woke up this morning to a half empty pond. Can't find any sign of the leak but since my only change was to the waterfall filter, I pulled the batting out, refilled the pond, and am hoping that maybe the added restriction of the batting caused pressure on the line and caused the hose or bulkhead to leak. Going to check the water levels in an hour or two. And if we get a day or two without rain, at least I'd be able to look for wet ground. Right now the whole yard is sopping.

you should have your waterfall filter setting on a piece of liner with the edges cupped up and the leading edge over lapping the pond liner.if any water over flows it will run into the pond.is the batting too dense or clogged.you might try a less dense filter material

That is how I have my waterfall filter. I don't think it overflowed the top, I think the extra pressure on the bulkhead or hose connection caused it to leak.

No sign of any water loss since I took the batting out. I think the little box was too small to handle the extra pressure of the batting.

So for now, instead, I put the batting in a basket, and put that under the output of the waterfall filter. Actually worked wonders, my water is crystal clear. But it's not going to work as a permenant part of the setup, since a bright blue plastic basket at the top of the stream kind of stands out :)