I don't have the book, and haven't read it, but Rommel wrote a book on the subject which might be worth checking out.
MG gunners were frequently assigned as point-man, when on patrol, with at least a couple of guys just to his rear, and/or slightly to his sides. That way, he had a roughly 270 degree arc of fire to the front and sides.
The two guys closest to him would be assistants, carrying spare barrels, ammo, etc., and also providing flank security for him.
The others in the squad would be behind, usually in single file, when advancing.
Can't recall where the MG'er was when advancing in line, or echelon, but suspect that could vary.
IIRC, there should be some squad formation images/diagrams on-line. Try doing a bit of searching with Google images for that, and/or tactics.
Hope that helps.
German squad/platoon tactics were built around the MG, with virtually all the other troops being there to either to help feed the weapon, or to provide covering fire for the MG'er and his loader, unlike in many other armies.
From the middle period of the war, and certainly during the late war period, it is fairly common for a squad to have two machine guns, and not just one, even when they're down to only 6 - 8 men.
From what I've read, due to manpower shortages as time went on, the squads would rarely be in full strength, so 10 man squads would be unusual, in many, if not most cases.