Always build it and yes it reduces corruption as much as the original
where to build it is the question not if.
If you are not going to venture far from home put it some way from your capital so that your Civ is a rough figure of eight. If you paln to conquer other continents build it close to your capital so that you can shift the palce later
if you build it in the city nearest the capital, then build a palace near the edge of your nation, then you get the same effect as warmonger stated, but now you have a higher chance of gaining cities culturally, since having a palace near the city that wants to flip increases the odds hugely.
I'm in a game right now where I've procrastinated building the FP and can't figure out where to put it. I know I need it, but the location is proving to be difficult. I suggest building it ASAP, unlike I did, and you can always adjust your palace later.
If you are building the FP in a far away corrupt city it helps a lot if you already have a courthouse in that city, and a temple too if you are short on luxuries. don't be afraid to disband your excess regular units (if forest chopping isn't an option) so you can get the courthouse in place quickly before starting on the FP. You may even want to consider rushing the courthouse while still in despotism.
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