Combined Writes
Dear Mark,
McMillan writes "the writer may often do best by writing half his position against in the moneys and half against out
of the moneys on the same stock."

However, he did not provide details such as...
a. Which stock is the best cadidate for this - one that is rising, dropping or moving sideways?
b. For the out-of-the-money : how far out the money and how much time before expiry?
c. For the in-the-money : how deep in the money and how much time before expiry?
Do you use this?

Hello Ren,  
No, I don't use this method.  I am not trying to be vague below.  Each investor must choose a method that meets his or her individual needs.  Thus,
a)Covered call writing is a bullish strategy, so you certainly want to adopt this strategy when the outlook is neutral to bullish.  Thus, I would avoid doing it when the stock is dropping, unless it is still above support levels. Aside from when a stock is falling, CCW is a decent strategy.  
b) There is no right answer.  It really depends on how bullish you are.  I never write out of the money calls.  That does not mean that is's not a good idea to do so, it's just that I am very concerned with risk and prefer to write an option that affords some reasonable amount of protection to the downside.  Writing OTM calls is a method for those who are looking for higher potential rewards and are willing to accept additional risk to achieve those rewards.  
As to expiry, I prefer the near-term in today's market conditions (low implied volatilities).  If and when IV returns to much higher leverls, I would prefer mid-term options.  Avoid selling options for peanuts - no nickels or dimes.  If the reward for selling is tiny, don't bother.  Not every stock has OTM options thata re worth selling.  If ATM does not work for you, perhaps it would be better to just keep the stock naked long.  Then you could sell ATM calls after a rally.  As I said, I don't do this myself.
c)There is no 'right' answer.  I write options that are in the money, but not by too much.  After all, the deeper in you go, the less the profit potential.  And you are writing covered calls to make money, so you must have some decent (a relative term) time premium in the call that you sell.  Thus, to me the answer is: deep enough to give you some downside protction, but not deep enough to provide an unacceptable return.  Bottom line:  If you would be happy to earn the time premium remaining in the call option as your maximum profit, then the call is suitable for covered call writing. If the reward (maximum profit) is too little to satisfy you, then the call is too deep in the money and you should not write that option.  
Expiry is not a consideration for me.  I prefer near-term, but look at the potential reward for any option I sell. Compare the return on your investment for options with more time remaining and determine for yourself if that reward, earned over the life of the option, provides a return that would please you.  If not, do not choose that option.  If it is an acceptable return for you, then the option is a good choice for selling.