MarcoPolo runs from the status bar (the right-hand portion of the menu bar containing icons), and does not show in the Dock. You can access MarcoPolo's preferences and other features through the MarcoPolo icon.
Enabling automatic switching
The 'Enable automatic switching' option needs to checked in the General preferences for automatic switching to occur. Other functionality, such as forced switching, will still work if this option is unchecked.
Hiding from status bar
If the 'Hide from status bar' option is checked in the General preferences, the MarcoPolo icon in the status bar will disappear about 10 seconds after launching (or after enabling this option). To restore the icon to access preferences, simply relaunch MarcoPolo, and the icon will be visible again for another 10 seconds.
Some evidence sources in MarcoPolo can occasionally return spurious data, either due to bad hardware (such as USB), or fundamentally unreliable physical circumstances (such as WiFi). This can sometimes cause MarcoPolo to momentarily switch away from the current (correct) context, and then switch back once the evidence source corrects itself.
If you check the 'Use switch smoothing' option in the General preferences, MarcoPolo will delay all context switching until two consecutive rule evaluations both yield the same guess. The interval between rule evaluations defaults to five seconds, so using switch smoothing will delay legitimate context changes by this length of time.
Sometimes MarcoPolo doesn't have enough evidence to make a confident enough guess as to your correct context. You can specify a default context to be used in these situations.
After MarcoPolo has combined all the matching rules, it arrives at a confidence for each possible context. The minimum confidence threshold is configurable via this slider.