If
Best position for speed or best position for less wear?
If your prop is in an aperture, like on a fixed keel boat, locking it vertically is probably good but your O'day is not configured like that. If you sail a fin keeler and you want to sail faster, and have a standard Michigan type prop, freewheeling should let you sail faster. If you have a Campbel Sailor prop locking vs. freewheeling makes no measurable difference in speed, I've physically measured drag on both a Michigan Wheel and a Campbel Sailor, so locked would be a better choice with a Campbell as there's no benefit to freewheeling.
Freewheeling can add more wear and tear to the cutlass bearing, stuffing box and transmission. Most transmissions you'd find on an O'day need to be either locked in reverse or left in neutral but not left in forward. Some transmissions also should not be allowed to spin without the engine running due to lack of lubrication but I don't believe yours would fall into this category. If your Yanmar has a Kanzaki gear box you can leave it in neutral but should avoid locking it in reverse.
For raw numbers, from my own testing, a 16" three blade Michigan Wheel at roughly four knots has about 39 pounds of drag. The same exact prop when allowed to freewheel, at a resistance similar to my sailboats prop shaft, has about 14 pounds of drag.