About 6 inches. I lay an LP on the kitchen counter (on top of a microfiber towel) and use the bent nozzle so I can hold the steamer nearly horizontal. Easier on my wrist.
12-09-07: Hififile
1) How far do I hold the steamer nozzle from the record?
Not sure that it matters, but I generally use a circular motion following the groove. I figure if the steam is moving in the same direction as the groove, it's more likely to blast it out of the deeper part of the groove. I also know that this is just speculation on my part.
2) What kind of motion do I use? Circular following the grooves or maybe from top to bottom?
I use the garden variety dish rack we already had. It is rubber-coated wire.
3) Is there a particular brand or type of dish rack to get to prevent scratching the record?
Personally I use a terry-cloth style microfiber towel (it claims 90,000 fiber naps sticking up per square inch). This helps wipe the gunk and water out of the groove. I then rack the LP after towel-drying it to let any residual moisture evaporate. Also, if you have gotten the label wet, you'll want to rack it until it's dry. You don't want to put a wet record back into its liner sleeve.
4) I'm confused, do you physically towel dry the records, or air dry them in the dish rack??
To avoid getting the label too wet, I lay an oriental rice bowl over the label. It covers it perfectly without covering any of the groove.