The Tallit should be worn in the fashion above.
Rav David Yosef, Rav Ovadia, Maran Shulhan Aruch, R' Matsliah` Ma'azuz, Rav Yaacov Rokah`, and the Ari (and more) all agree that one should cover the head with the Tallit.
The Ari says that we must cover the Teffilin of the head with the Tallit, while Maran says not to.
Rav Matsliah` Ma'azuz brings both the opinions down, and says that we should follow the Ari.
Putting on the Talit it'self- The Ben Ish Hai (Ba"h` Bereshit), and Rav Yitshak (Yalku"Y 8:22), and Maran- all agree on how to put on Tallit.
Take the Tallit, and hold it (some hold to kiss all four corners, and Rav Ovadia [Yehaveh Da'at 5, 1] holds to check the strings) then say the blessing.
Then take it, and put over the head, and take all four corners- put them in front, and take the right wing (2 corners) , and swing over your left shoulder[keep it there]. Then take the left wing (2 corners), and swing over the left shoulder. Now take both off, and while your putting it on- make sure it doesn't cover your mouth.