You need arctic silver between the waterblock and the CPU. As far as the watercooling loop goes, you can either put everything together and leak test it out of the case for a day or so to make sure nothing leaks and then install it into the case, or if you feel confident enough, you can install it into your case WITHOUT turning on the PC and just run the pump by unplugging the PS from everything and jumping the green to a black wire on the ATX wiring connector on the PS with just the pump plugged in. Add as much water as possible, shake things around, add again, and then turn on the PS for a couple of seconds, add more water, etc. until the air bubbles dissapear. Just don't let your pump run without any water going through it.